The House of Representatives has approved a series of tax reform bills, introducing significant changes to the nation’s tax system while exempting specific sectors from taxation.
Under the new legislation, wages earned by military personnel, funds received by religious organizations, pension funds, trade unions, profit-oriented schools, and cooperative societies will not be subject to tax.
In addition, the Tertiary Education Trust Fund (TETFund) is set to receive 50% of revenues generated from the development levy included in the reform package. This allocation aims to boost funding for tertiary education in the country.
Despite initial controversies surrounding the proposed bills, the House reached a unanimous decision after extensive deliberations. Lawmakers held a three-day public hearing followed by an eight-day retreat to address concerns and refine the legislation.
The bills were eventually adopted on Thursday after recommendations from the Special Adhoc Committee on Finance were reviewed.
The Senate is now expected to consider and pass its version of the bills within the week, while the House is scheduled to hold a third reading and final passage during plenary on Tuesday.
Sources within the House leadership revealed that Speaker Abbas Tajudeen played a crucial role in securing consensus.
To ensure smooth passage, the Speaker directed lawmakers to engage with their constituencies, consult at state and zonal caucus levels, and hold strategic meetings with key stakeholders. This approach helped address concerns raised by various groups and facilitated broad support for the bills.
During the legislative process, the Speaker expanded the House Committee on Finance, incorporating regional leaders, zonal caucus heads, and tax experts from all 36 states to strengthen the review process. Continuous engagement with lawmakers and the public further reinforced support for the reforms.
By the time the bills reached the second reading and public hearing stages, most initial opposition had been addressed.
The final deliberations reflected widespread acceptance, with no dissenting voices recorded during the plenary session.
The four bills introduce sweeping reforms aimed at modernizing Nigeria’s tax framework, improving revenue generation, and repealing outdated tax laws.
One of the bills establishes the Tax Appeal Tribunal, expanding its jurisdiction to cover all federal and state tax laws.
The tribunal will be funded through the Consolidated Revenue Fund and will have the authority to adjudicate disputes arising from the Nigeria Tax Act, the Nigeria Tax Administration Act, and other tax-related legislation.
Additionally, the Nigeria Tax Administration Bill mandates the issuance of a Tax Identification Number (TIN) to every taxable individual and corporate entity, ensuring greater compliance and streamlining tax administration.
Another key provision includes the creation of the Tax Ombudsman, an independent body that will oversee tax-related complaints and ensure transparency in tax administration.
The office will be funded separately through the Consolidated Revenue Fund to guarantee financial independence and operational stability.
As the Senate prepares to deliberate on its version of the tax reform bills, lawmakers anticipate a smooth passage, given the broad consensus achieved in the House.
If approved, the reforms will mark a major shift in Nigeria’s tax system, balancing revenue generation with exemptions designed to protect key sectors of the economy.
