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Oyedele outlines 10 advantages of tax reform bills for Nigerians.
The ongoing discourse surrounding President Bola Tinubu’s tax reform bills has ignited considerable debate, particularly among Northern governors and various regional groups who express strong opposition to the proposed legislation. However, Taiwo Oyedele, Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, has articulated ten key benefits of these bills, which are currently under consideration by the National Assembly.
In a statement shared via his official X account, Oyedele emphasized that the tax reforms aim to enhance the fiscal landscape of Nigeria while alleviating the burden on low-income earners. Notably, individuals earning up to N83,000 monthly will be exempt from the Pay As You Earn (PAYE) tax, and those earning less than N1.7 million annually will see a reduction in their PAYE obligations.
The proposed bills also include several provisions designed to support households and individuals, such as the implementation of a zero percent value-added tax (VAT) on essential services and goods, including food, healthcare, education, and transportation. Additionally, there are provisions for VAT exemptions on transportation, renewable energy, and essential household products.
Oyedele outlined the benefits of the tax reform bills as follows:
1. Complete exemption of low-income earners (up to N1 million per annum) from PAYE.
2. Reduced PAYE tax for those earning less than N1.7 million annually.
3. Zero VAT on food, healthcare, education, electricity generation, and transmission.
4. VAT exemption on transportation, renewable energy, CNG, baby products, sanitary towels, rent, and fuel products.
5. Tax breaks for wage awards and transport subsidies for low-income earners.
6. Tax incentives for employers to increase hiring compared to the previous three years.
7. Exemption of stamp duties on rent below N10 million.
8. PAYE tax exemptions for members of the armed forces engaged in combating insecurity.
9. Tax-friendly regulations for remote workers and digital nomads.
10. Clarification on the taxation of digital assets to prevent double taxation and allow for loss deductions.
These bills, which include the Joint Revenue Board of Nigeria (Establishment) Bill, 2024; Nigeria Revenue Service (Establishment) Bill, 2024; and the Nigeria Tax Bill, 2024, are designed to revamp the country’s tax laws and stimulate economic growth by benefiting small businesses, investments, and subnational entities. As the bills progress through the legislative process, their potential impact on Nigeria’s fiscal policy and economic landscape remains a topic of significant interest and discussion.