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Presidential Fiscal Policy and Tax Reforms Committee

    Background

    Nigeria has a revenue crisis, and it cuts across all tiers of government. The country’s Tax to GDP ratio is one of the lowest in the world and much below the African average. This has led to an overreliance on borrowing to finance public spending which in turn limits the fiscal space as debt service costs consumes a greater portion of government revenue annually resulting in a vicious cycle of inadequate funding for socio-economic development.

    While incremental progress has been recorded over the years, the outcomes have not been transformative enough to change the narrative.

    • Statement of Purpose

    • The key objectives of the Committee’s work include:

      • Harmonisation of multiple taxes and levies at all levels of government to a few that are broad based and easy to administer
      • Unification of revenue collection functions into single agency per level of government as much as possible
      • Modernisation and simplification of the tax system including the use of technology for revenue administration
      • Leveraging on data for intelligence to curb evasion and aggressive tax avoidance
      • Remove tax provisions which serve as impediments to business and economic growth
      • Devise structures and framework to institutionalise reforms for effective policy coordination and collaboration among government agencies and tiers of government
      • Improve efficiency of revenue collection and transparent reporting
      • Ensure effective utilisation of tax and other revenues for social good to boost citizens’ tax morale, promote tax culture and drive voluntary compliance
      • Transform revenue generation for sustainable development to achieve at least 18% Tax to GDP ratio within the next 3 years, that is, by 2026
    • Key Challenges

    • The major challenges of the Nigerian tax system, which are well documented, include:

      • Multiplicity of taxes and multiple revenue collection agencies
      • Largely fragmented, rudimentary, and complex tax system adding to business risk and uncertainties
      • High cost of revenue administration on the part of government and excessive burden of compliance on the part of taxpayers
      • Poor accountability and inability to demonstrate efficient utilisation of tax revenue for commensurate fiscal exchange
      • Growing tax expenditure, erosion of the country’s tax base and arbitrary tax waivers
    • Deliverables & Outcomes

    • The expected outcomes from the work of the committee will include, but not limited to the following:

      • Repeal of existing taxes and levies especially those that are suboptimal, obsolete or unduly burdensome and enactment of new harmonised tax laws
      • Preparation of a harmonised list of taxes and levies, not exceeding single digit in number and covering all levels of government
      • Review of the 2017 National Tax Policy to produce a new National Policy on Tax and Fiscal Policy for ratification by the federal and state governments
      • A national fiscal risk framework for efficient fiscal governance and fiscal stability
      • Enhancements to the revenue administration system to improve revenue mobilisation and a robust framework for tax revenue accounting and reporting to improve taxpayer trust
      • Establishment of Federal Office of Tax Ombudsman and Tax Simplification
      • Executive Orders and Regulations to implement tax and fiscal reforms which do not require legislative changes
      • Model tax codes and revenue administration templates for adoption or adaptation by subnational level of government
      • A National Tax Amnesty Scheme to expand the tax net and give taxpayers the opportunity for self-remediation
    • Composition

    • The membership of the committee has been carefully constituted to ensure diversity of in-depth knowledge, robust expertise, and broad representation by key stakeholder groups across the geopolitical zones.

      1. Taiwo Oyedele, Chairman 
      2. Representatives of Tax Practice, Law and Accounting Firms
      3. Members of the Tax Advisory Committee
      4. National Tax Policy Implementation Committee
      5. Renowned Fiscal Policy and Tax Experts
      6. Representative of the Chartered Institute of Taxation of Nigeria (CITN)
      7. Representative of the Institute of Chartered Accountants of Nigeria (ICAN)
      8. Representative of the Association of National Accountants of Nigeria (ANAN)
      9. Representative of the Nigerian Bar Association (NBA)
      10. Nigerian Economic Summit Group (NESG)
      11. Organised Private Sector of Nigeria (OPSN)
      12. Nigerian Association of Small and Medium Enterprises (NASME)
      13. Women in Business (WIMBIZ)
      14. Representative of the Federal Ministry of Justice
      15. Representative of the Federal Ministry of Finance
      16. Representative of Federal Ministry of Trade, Industry & Investment
      17. Representative of Ministry of Telecommunications & Digital Economy
      18. Nigerian Investment Promotion Commission (NIPC)
      19. Tariff Technical Committee
      20. Nigerian Ports Authority (NPA)
      21. Nigerian Maritime Administration and Safety Agency (NIMASA)
      22. Nigerian Upstream Petroleum Regulatory Commission (NUPRC)
      23. The Federal Inland Revenue Service (FIRS)
      24. The Joint Tax Board (JTB)
      25. Nigeria Customs Service
      26. Representative of Association of Local Government of Nigeria (ALGON)
      27. National Institute for Legislative and Democratic Studies (NILDS)
      28. National Institute for Policy and Strategic Studies (NIPSS)
      29. Revenue Mobilisation Allocation and Fiscal Committee (RMAFC) 
      30. The Budget Office of the Federation
      31. Accountant General of the Federation
      32. National Bureau of Statistics
      33. DG, Nigeria Governors’ Forum
      34. Debt Management Office
      35. Chairman, Finance Commissioners’ Forum
      36. Central Bank of Nigeria
    • FAQ

    • The committee was set up by President Bola Tinubu to review and redesign Nigeria’s fiscal system with respect to (1) revenue mobilisation, both tax and non-tax (2) quality of government spending and (3) sustainable debt management. In addition, the committee will identify relevant measures to make Nigeria an attractive destination for investment and facilitate inclusive economic growth.

      The work of the committee is expected to be completed within one year divided into 3 milestones (1) Quick Wins within 30 days focusing on urgent interventions to cushion the effect of current socio-economic challenges (2) Critical Reforms within 6 months including measures to address multiplicity of taxes, simplify the tax laws, ensure policy coordination, drive accountability and transparent reporting (3) Implementation of structural revenue reform measures and critical fiscal policy changes.

      No. The committee will work with all levels of government as critical stakeholders to ensure effective collaboration in the design and implementation of necessary fiscal policy changes and localisation of reforms at the subnational level as may be applicable.

      embers of the committee are drawn from a diverse pool of eminently qualified Nigerians across all geopolitical zones, age brackets, religion, and gender. They represent the private sector including trade associations, small businesses, civil society, and professional bodies as well as public sector institutions at federal, states and local government levels.

      The committee will open channels of communication and platforms for submission of inputs by the end of September 2023. In addition, we have outlined various stakeholder engagement sessions with Nigerians from all walks of life including people living with disabilities, artisans, Nigerians in the diaspora, multinational companies, international investment community and so on. Everyone who has something to say will be heard.

      We do not intend to introduce new taxes or impose higher tax rates. Rather, our mandate is to reduce the number of taxes and levies while harmonising revenue collection to reduce the burden on the people and businesses. The objective is to avoid taxing investment, capital, production or poverty. We plan to review and re-enact the major tax laws in a holistic manner thereby limiting the necessity for frequent changes through annual finance acts.

      The average tax to GDP ratio for Africa excluding Nigeria is about 18%. This is the basis for the target of 18% and the estimated tax gap of N20 trillion. There is a huge opportunity to generate revenue by leveraging technology and tax intelligence to close the tax gap. In addition, we will rationalize incentives, reduce the cost of collection, and optimise revenue from government assets and natural resources. This way we can generate more revenue without introducing new taxes.

      No agency has been stopped from collecting revenue as many of them are empowered to do so by law. However, many of the agencies would rather focus on their primary functions hence we intend to harmonise the fragmented revenue collection functions into one agency for each government. This is the case in many countries including the leading tax regimes in Africa. This reform will help to improve efficiency and enable the agencies to focus on their primary mandates for the overall benefit of the economy.

      The committee was set up not just to advise the government but also to support the implementation of recommended reform measures. The committee’s assignment is being carried out to the highest degree of independence driven by national interest within the context of modern-day economic realities and emerging issues within the international community.

      Members of the public and other stakeholders can follow our activities on social media, fiscalreformsng on X, LinkedIn, Instagram, Facebook and via our YouTube channel. We will provide regular updates via our dedicated website and press releases. You can also reach us via email at enquiries@fiscalreforms.ng or via WhatsApp chat on +234 810 975 3151.

    The key objectives of the Committee’s work include:

    • Harmonisation of multiple taxes and levies at all levels of government to a few that are broad based and easy to administer
    • Unification of revenue collection functions into single agency per level of government as much as possible
    • Modernisation and simplification of the tax system including the use of technology for revenue administration
    • Leveraging on data for intelligence to curb evasion and aggressive tax avoidance
    • Remove tax provisions which serve as impediments to business and economic growth
    • Devise structures and framework to institutionalise reforms for effective policy coordination and collaboration among government agencies and tiers of government
    • Improve efficiency of revenue collection and transparent reporting
    • Ensure effective utilisation of tax and other revenues for social good to boost citizens’ tax morale, promote tax culture and drive voluntary compliance
    • Transform revenue generation for sustainable development to achieve at least 18% Tax to GDP ratio within the next 3 years, that is, by 2026

    The major challenges of the Nigerian tax system, which are well documented, include:

    • Multiplicity of taxes and multiple revenue collection agencies
    • Largely fragmented, rudimentary, and complex tax system adding to business risk and uncertainties
    • High cost of revenue administration on the part of government and excessive burden of compliance on the part of taxpayers
    • Poor accountability and inability to demonstrate efficient utilisation of tax revenue for commensurate fiscal exchange
    • Growing tax expenditure, erosion of the country’s tax base and arbitrary tax waivers

    The expected outcomes from the work of the committee will include, but not limited to the following:

    • Repeal of existing taxes and levies especially those that are suboptimal, obsolete or unduly burdensome and enactment of new harmonised tax laws
    • Preparation of a harmonised list of taxes and levies, not exceeding single digit in number and covering all levels of government
    • Review of the 2017 National Tax Policy to produce a new National Policy on Tax and Fiscal Policy for ratification by the federal and state governments
    • A national fiscal risk framework for efficient fiscal governance and fiscal stability
    • Enhancements to the revenue administration system to improve revenue mobilisation and a robust framework for tax revenue accounting and reporting to improve taxpayer trust
    • Establishment of Federal Office of Tax Ombudsman and Tax Simplification
    • Executive Orders and Regulations to implement tax and fiscal reforms which do not require legislative changes
    • Model tax codes and revenue administration templates for adoption or adaptation by subnational level of government
    • A National Tax Amnesty Scheme to expand the tax net and give taxpayers the opportunity for self-remediation

    The membership of the committee has been carefully constituted to ensure diversity of in-depth knowledge, robust expertise, and broad representation by key stakeholder groups across the geopolitical zones.

    1. Taiwo Oyedele, Chairman 
    2. Representatives of Tax Practice, Law and Accounting Firms
    3. Members of the Tax Advisory Committee
    4. National Tax Policy Implementation Committee
    5. Renowned Fiscal Policy and Tax Experts
    6. Representative of the Chartered Institute of Taxation of Nigeria (CITN)
    7. Representative of the Institute of Chartered Accountants of Nigeria (ICAN)
    8. Representative of the Association of National Accountants of Nigeria (ANAN)
    9. Representative of the Nigerian Bar Association (NBA)
    10. Nigerian Economic Summit Group (NESG)
    11. Organised Private Sector of Nigeria (OPSN)
    12. Nigerian Association of Small and Medium Enterprises (NASME)
    13. Women in Business (WIMBIZ)
    14. Representative of the Federal Ministry of Justice
    15. Representative of the Federal Ministry of Finance
    16. Representative of Federal Ministry of Trade, Industry & Investment
    17. Representative of Ministry of Telecommunications & Digital Economy
    18. Nigerian Investment Promotion Commission (NIPC)
    19. Tariff Technical Committee
    20. Nigerian Ports Authority (NPA)
    21. Nigerian Maritime Administration and Safety Agency (NIMASA)
    22. Nigerian Upstream Petroleum Regulatory Commission (NUPRC)
    23. The Federal Inland Revenue Service (FIRS)
    24. The Joint Tax Board (JTB)
    25. Nigeria Customs Service
    26. Representative of Association of Local Government of Nigeria (ALGON)
    27. National Institute for Legislative and Democratic Studies (NILDS)
    28. National Institute for Policy and Strategic Studies (NIPSS)
    29. Revenue Mobilisation Allocation and Fiscal Committee (RMAFC) 
    30. The Budget Office of the Federation
    31. Accountant General of the Federation
    32. National Bureau of Statistics
    33. DG, Nigeria Governors’ Forum
    34. Debt Management Office
    35. Chairman, Finance Commissioners’ Forum
    36. Central Bank of Nigeria

    The committee was set up by President Bola Tinubu to review and redesign Nigeria’s fiscal system with respect to (1) revenue mobilisation, both tax and non-tax (2) quality of government spending and (3) sustainable debt management. In addition, the committee will identify relevant measures to make Nigeria an attractive destination for investment and facilitate inclusive economic growth.

    The work of the committee is expected to be completed within one year divided into 3 milestones (1) Quick Wins within 30 days focusing on urgent interventions to cushion the effect of current socio-economic challenges (2) Critical Reforms within 6 months including measures to address multiplicity of taxes, simplify the tax laws, ensure policy coordination, drive accountability and transparent reporting (3) Implementation of structural revenue reform measures and critical fiscal policy changes.

    No. The committee will work with all levels of government as critical stakeholders to ensure effective collaboration in the design and implementation of necessary fiscal policy changes and localisation of reforms at the subnational level as may be applicable.

    embers of the committee are drawn from a diverse pool of eminently qualified Nigerians across all geopolitical zones, age brackets, religion, and gender. They represent the private sector including trade associations, small businesses, civil society, and professional bodies as well as public sector institutions at federal, states and local government levels.

    The committee will open channels of communication and platforms for submission of inputs by the end of September 2023. In addition, we have outlined various stakeholder engagement sessions with Nigerians from all walks of life including people living with disabilities, artisans, Nigerians in the diaspora, multinational companies, international investment community and so on. Everyone who has something to say will be heard.

    We do not intend to introduce new taxes or impose higher tax rates. Rather, our mandate is to reduce the number of taxes and levies while harmonising revenue collection to reduce the burden on the people and businesses. The objective is to avoid taxing investment, capital, production or poverty. We plan to review and re-enact the major tax laws in a holistic manner thereby limiting the necessity for frequent changes through annual finance acts.

    The average tax to GDP ratio for Africa excluding Nigeria is about 18%. This is the basis for the target of 18% and the estimated tax gap of N20 trillion. There is a huge opportunity to generate revenue by leveraging technology and tax intelligence to close the tax gap. In addition, we will rationalize incentives, reduce the cost of collection, and optimise revenue from government assets and natural resources. This way we can generate more revenue without introducing new taxes.

    No agency has been stopped from collecting revenue as many of them are empowered to do so by law. However, many of the agencies would rather focus on their primary functions hence we intend to harmonise the fragmented revenue collection functions into one agency for each government. This is the case in many countries including the leading tax regimes in Africa. This reform will help to improve efficiency and enable the agencies to focus on their primary mandates for the overall benefit of the economy.

    The committee was set up not just to advise the government but also to support the implementation of recommended reform measures. The committee’s assignment is being carried out to the highest degree of independence driven by national interest within the context of modern-day economic realities and emerging issues within the international community.

    Members of the public and other stakeholders can follow our activities on social media, fiscalreformsng on X, LinkedIn, Instagram, Facebook and via our YouTube channel. We will provide regular updates via our dedicated website and press releases. You can also reach us via email at enquiries@fiscalreforms.ng or via WhatsApp chat on +234 810 975 3151.

    Observers & Partners

    Selected local and international observers and partners are expected to support the work of the committee including the World Bank, International Monetary Fund, United Nations, BudgIT, Tax Justice & Governance Platform.

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