In a recent update, the Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, Taiwo Oyedele, addressed concerns regarding taxation policies under the potential leadership of President Bola Tinubu. Oyedele, who assumed office in August to lead the committee, emphasized that there are no plans to introduce additional taxes or escalate existing tax rates.
Speaking via his social media handle, Oyedele highlighted the committee’s primary objective: to streamline the existing tax structure and alleviate the burden on individuals and businesses. He stated, “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 harmonizing revenue collection to reduce the burden on the people and businesses.”
The overarching goal is to avoid imposing taxes on critical areas such as investment, capital, production, or those already experiencing economic challenges. Oyedele outlined plans to comprehensively review and revise major tax laws, minimizing the need for frequent adjustments through annual finance acts.
Addressing the target of achieving an 18 percent tax-to-GDP ratio within three years, Oyedele explained, “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.” He further emphasized the potential for revenue generation through technological advancements and tax intelligence to bridge this gap. Additionally, the committee intends to rationalize incentives, streamline collection costs, and optimize revenue from government assets and natural resources, all contributing to enhanced revenue without resorting to new taxes.
Importantly, Oyedele clarified that the committee’s mandate extends beyond federal jurisdiction, involving cooperation with all levels of government. This inclusive approach aims to facilitate effective collaboration in designing and implementing necessary fiscal policy changes, ensuring localized reforms at subnational levels as needed.
As the committee looks forward to a future under President Tinubu, the focus remains on fostering an environment conducive to economic growth and prosperity for all stakeholders. This commitment to a balanced and streamlined tax regime bodes well for individuals and enterprises alike.