The Majority Leader of the Senate, Senator Opeyemi Bamidele (APC, Kwara), has addressed misconceptions surrounding the four Tax Reform Bills currently before the National Assembly.
In a statement released on Wednesday to mark the Christmas celebration, Senator Bamidele dismissed claims about the derivation model in the Bills as “utterly incorrect and unfounded.”
“The proposed tax reform bills, described as executive legislation, include a review of derivations to states. Under the new model, Kano State’s share would rise from 0.89 per cent to 6.17 per cent, while Zamfara State’s allocation would increase from 0.05 per cent to 1.21 per cent.
“However, Lagos State, which currently receives 80.26 per cent, would see a significant reduction to 15.28 per cent, representing an 81 per cent decrease. Rivers State’s share would also drop from 7.74 per cent to 4.6 per cent, marking a 41 per cent reduction,” he stated.
Additionally, the Bills propose tax exemptions for employees earning ₦1,000,000 annually (₦83,000 monthly), as well as for start-ups, shared services, and technologically-driven businesses. They also recommend zero VAT on essential services and consumables.
The reform Bills have sparked debates, particularly from northern governors, who have labelled them ‘anti-North’. Similarly, members of the National Assembly from across the country have expressed divergent views on the proposed VAT sharing formula in the proposed legislation.
LEADERSHIP reports that the National Economic Council (NEC), led by Vice President Kashim Shettima, had earlier urged President Bola Tinubu to withdraw the Bills for further consultation.
However, the President insisted that all concerns be addressed within the ongoing legislative process on the Bills.
Governor Babagana Zulum of Borno State recently criticised the reforms, claiming they would disproportionately benefit Lagos State, the President’s home state.
However, Senator Bamidele emphasised that the reforms aimed to foster an environment conducive to business, investment, and economic growth.
“We are committed to building an environment where businesses can operate seamlessly; where investors are confident, and where Nigerians can thrive without undue burdens,” he said.
He noted that the reforms, including the Tax Reform Bills, National Minimum Wage Act, and Investment and Securities Act, were designed to reverse troubling economic indicators.
He reassured Nigerians that the reforms were guided by principles of equity, fairness, and justice.
“Contrary to misconceptions, the Tax Reform Bills exempt all employees earning ₦1,000,000 annually, support start-ups and technological services, and propose zero VAT on essential goods and services,” he clarified.
Addressing the Christmas season, the Senate Leader highlighted the importance of gratitude, reflection, and compassion.
He urged Nigerians to remember the needy, reflect on Christ’s mission, and pray for the country’s economic recovery, political stability, and unity.
“As we celebrate, let us recommit to the development of our nation. This is not the time to search for greener pastures abroad but to join hands to rebuild and rebrand our homeland,” he stated.
President Tinubu, during his recent Presidential Media Chat, affirmed his commitment to reforming Nigeria’s tax system, stressing that “tax amendments require negotiation and consensus.”
He reassured Nigerians that while the reforms may be challenging, they were necessary to secure the nation’s future.
Senator Bamidele concluded his message with warm wishes for the festive season: “With all my heart, I wish you all happy celebrations in this season of deep reflection. Merry Christmas and Happy New Year in advance.”