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Tag: Taiwo Oyedele

  • FG may sanction agencies for hoarding data, says Oyedele

    FG may sanction agencies for hoarding data, says Oyedele

    …bulk of tax evasion occurs in the states: NFIU

    The federal government is considering imposing sanctions on agencies that refuse to share data with sister agencies upon request.

    The was disclosed by Taiwo Oyedele, chairman of the Presidential Fiscal Policy and Tax Reform Committee, at the first Revenue Assurance Summit in Abuja on Tuesday, October 15.

    The event, organised by the Nigerian Financial Intelligence Unit (NFIU), brought together Internal Revenue Services from all states of the federation and the Federal Capital Territory (FCT).

    Oyedele’s comments came in response to an account given by the Executive Secretary of the Joint Tax Board (JTB), Olusegun Phillip Adesokan, who expressed frustration over a government agency’s refusal to share crucial data with the JTB.

    According to Adesokan, the agency demanded payment in exchange for the requested data, which raised concerns about the effectiveness of the government’s efforts to enhance revenue generation.

    Read Also: ‘Sugar tax hike will boost revenue by 972%’

    Oyedele noted the importance of data sharing in driving revenue growth, stating, “We are talking about revenue assurance. We need to bear in mind that even the revenue itself is a means to an end, not an end in itself. It must make a meaningful impact on the lives, livelihood, and well-being of the people for it to make sense.”

    He emphasised the need for collaboration among various government bodies to ensure a unified approach to economic policies.

    “Let’s not be pulling in different directions—states versus federal, or even within federal agencies,” he added.

    Noting the challenges faced by the JTB, Oyedele expressed disbelief over the requirement to pay for data within government circles, especially when the lack of revenue is a recurring issue.

    “A particular agency asked JTB to pay for data. I couldn’t believe it. In the same Nigeria? The government has data, and the government is selling data, and we say the government does not have revenue.”

    To address this issue, Oyedele revealed that a law is being drafted to criminalize data hoarding within government agencies.

    “We are developing a protocol to ensure integrity, data protection, and other safeguards. We will give you a deadline of 48 hours; if you don’t release the data, there will be consequences,” he warned.

    Earlier, Mrs. Hafsat Bakari, Chief Executive Officer of the NFIU, outlined the agency’s efforts to expand its work on tax crimes by collaborating with state-level tax authorities.

    Bakari stated that the majority of tax evasion occurs at the state level, and the NFIU’s data on financial transactions could be instrumental in combating this issue.

    The NFIU, she explained, has developed a secure platform known as the Crime Records Information Management System (CRIMS), which allows for the safe exchange of intelligence between the NFIU and state Internal Revenue Services.

    “Through CRIMS, we have entirely eliminated paper records which are prone to compromise, and we have robust audit mechanisms to ensure we are aware of who is asking for and receiving our intelligence,” Bakari said.

  • Those earning N1.5m or less monthly to get tax slash

    Those earning N1.5m or less monthly to get tax slash

    • Earners of N100m monthly to pay 25% tax

    Nigerians earning N100 million and above monthly may soon begin to pay 25 percent personal income tax.

    This is contained in a new tax bill being considered by the National Assembly.

      Presidential Fiscal Policy and Tax Reforms Committee Chairman  Taiwo Oyedele, who made this known yesterday, explained that the bill exempts persons who earn less than N100 million every month. 

    “If you earn N100 million a month, we’re taking up to 25 percent from you as a rich person. That’s because we need to balance the books,” Oyedele said at a breakout session of the ongoing 30th Nigeria Economic Summit (NES) in Abuja. 

     ‘’For middle-income earners making N1.5 million or less per month,  their income tax obligations would decrease, while those earning higher amounts would see incremental increases in their tax rates, eventually reaching 25 percent. Lower-income earners would be fully exempt from personal income tax.’’

    He added that if the bill is passed by the National Assembly and assented to by President Bola Tinubu,    payment might begin January 2025.  

    The tax committee chairman added that corporate income tax rate might drop from 30 to 25 percent. 

    Read Also: Tax dodger’s creed: Economic reforms expose fault lines of Nigerian entitlement

    Other significant tax adjustments include a reduction or elimination of  Value Added Tax(VAT) on essential items and services like food, health, education, accommodation, and transportation.

    Oyedele emphasised the need to strike a balance between easing the tax burden of lower-income earners and ensuring the wealthy contributed more to government revenue.

     According to him, the tax reform is also expected to ease the tax burden of businesses.  

    “Today, whatever VAT (Value Added Tax) you (businesses) pay on assets—whether you’re building a factory, buying a laptop, or vehicles—you bear it. This increases your cost, and therefore, your pricing will go up. Once our reforms are implemented, you get the credit back 100 percent on services and assets.”

    On concerns over tax incentives and waivers, Oyedele argued that their indiscriminate application harms the economy.

       “We cannot give all the incentives being asking for. We think the biggest low-hanging fruit is removing these incentives and that’s exactly what we are doing,” Oyedele concluded.

  • Presidential committee proposes tax exemption for 95% of informal sector

    Presidential committee proposes tax exemption for 95% of informal sector

    …those earning ₦25m and less get tax exemption

    The Presidential Fiscal Policy and Tax Reforms Committee (PFPTRC) has revealed plans to revolutionize Nigeria’s tax system, exempting 95% of the informal sector from all taxes. 

    Chairman of the Committee, Taiwo Oyedele, who revealed this over the weekend while speaking to journalists at the end of the close-out retreat of the PFPTRC in Abuja, explained that this move aims to alleviate the burden of multiple taxation on small businesses and low-income individuals.

    According to Oyedele, the informal sector is populated by citizens working hard to earn a legitimate living, adding that the in the view of the committee, people in this category should not be over-burdened with taxation, but rather support to grow economically to a point where they can fit into the more affluent categories before imposing taxes on them. 

    He further explained that a lot is put into consideration to have come to the recommendation, noting the those who earn between ₦25 million and less per annum should be expected from paying all forms of taxes, including income and value added tax (VAT). 

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    Oyedele emphasised the need for tax reform, stating, “Everybody, even if you’re not a business person, feels the impact of multiple taxation almost everywhere you turn. It affects small businesses even more than large businesses, and the poor and vulnerable population are having to deal with it.

    “So we’re using data to inform our decisions, currently if you earn N25 million a year or less, you don’t have to pay company income tax, you don’t have to worry about VAT. We’re looking at increasing that significantly, first to recognize the inflation we’ve had to contend with over the past few years and also because we think that this whole idea and concept of “your money is in the informal sector” is not supported by data. 

    “We think that the informal sector are people who are trying to earn legitimate living, we should allow them be and support them to grow to a point where they can then have the ability to pay taxes. So we think that 95% of the informal sector should be legally exempted from all taxes; withholding tax, company income tax, even payee on their staff, let them be. 

    “We can then focus our attention on top 5% of that sector and of course, the middle class and the elites. We think that the days of being above the law in paying taxes are over. The same thing we’re saying to our leaders, whether they are elected or appointed, we think they have to lead by example by showing that they have paid the taxes, not only on time, but correctly to the lawful authorities as contained in the various laws”, he said.

    He said the committee’s proposal for tax reforms is expected to be submitted to the National Assembly by the third quarter of this year. 

    Oyedele revealed that the committee has concluded the proposal phase and is currently consulting with the private sector, with internal approvals expected by the end of June. 

    He said some executive orders and regulations, such as the new withholding tax regulation exempting small businesses, are ready for implementation and await the Minister’s signature. 

    Additionally, a new National Tax Policy, Spending Policy, and Borrowing Policy will be introduced before the end of the year, while Constitutional amendments are expected in 2025 and 2026, aligning with the National Assembly’s two-year timeline.

    “We just closed out now on the proposal phase, we’re already consulting with the private sector. That consultation we expect will continue for the rest of this month, May, and then the internal approvals, whether it’s FEC, whether it’s NEC, whether it’s any other organ of government, up until the end of June. 

    “We envisage by the Quarter Three, our documents will be ready to go to the National Assembly and by the end of that Q3, we should have them enacted into law, so we can give reasonable notice to the public, businesses, individuals before commencement for many of them kick off in 2025. 

    “But where we have executive orders, directive regulations that don’t require enactment into law, like we have a new withholding tax regulation, where small businesses will be exempt from having to deduct withholding tax, that based on the existing law today, you don’t need to enact it into law, we just need the Minister to sign. So it’s ready, we’re waiting for the final signature. 

    “We also have a new National Tax Policy that communicates this direction of our tax system, how we’re going to be spending our money, we have a Spending Policy now, as well as Borrowing Policy so that the social contract with the people is delivered to them in a meaningful way. 

    “So all of that will happen before the end of the year, but where we are enacting the law and proposals to amend the Constitution, will happen in 2025, and maybe 2026, in the case of the Constitution because I think the timeline that the National Assembly has is about two years”, he said.

    He said the administration is reforming the country’s tax system with the aim to reduce the burden of multiple taxation on small businesses and low-income individuals. 

    According to him, despite numerous taxes, the country’s tax collection as a percentage of GDP remains low and to address this, the government intends to repeal many taxes, harmonize the remaining ones, and improve tax collection efficiency.

  • More food items, drugs, educational materials to be exempted from VAT

    More food items, drugs, educational materials to be exempted from VAT

    Large number of food items, medications, educational materials and other items are to be exempted from Value Added Tax (VAT), it was learnt yesterday.

    The Federal Government plans to streamline taxes and improve the business environment.

    The Presidential Committee on Fiscal Policy and Tax Reforms, led by Taiwo Oyedele, at a policy exposure and impact assessment session, said the series of proposals were aimed at streamlining Nigeria’s tax system, reducing burdens on businesses and consumers, and ultimately stimulating economic growth.

    Oyedele outlined the committee’s recommendations which  included a significant expansion of VAT exemptions and a potential overhaul of the current consumption tax structure.

    He said the committee “discussed other proposals to reduce companies income tax rate, increase exemption threshold for personal income tax” while a central focus of the proposals is a shift toward a more socially sensitive VAT regime.

    “We propose to remove Value Added Tax (VAT) on an expanded list of basic food, educational and healthcare items to protect the poor,” Oyedele said.

    He noted that the move would directly reduce the cost of essential goods and services for Nigerians most in need.

    Read Also; I didn’t propose increase in VAT rate, says Taiwo Oyedele

    According to him, beyond consumer-focused reforms, the committee is advocating for measures to ease the tax burden on businesses, including a proposal involving “full input VAT credit for businesses”, which would allow businesses to reclaim the VAT they pay on goods and services used in their operations, leading to lower overall costs and improved cash flow.

    The committee also recommended to the government to “harmonise all consumption taxes into one (VAT only)” streamlining the tax landscape for businesses. This means that businesses will only have to deal with VAT.  Additionally, the committee has proposed adjusting the revenue sharing formula “in favour of states to address multiplicity of taxes.” This would incentivize states to rely less on many smaller consumption taxes and focus on VAT collection.

    Further proposals target boosting non-oil exports. The committee has recommended the “removal of VAT on export of service and intellectual property.”  This would make Nigerian exports more competitive in the global marketplace.

    Recognizing the challenges faced by small businesses, the committee also proposed  “increase the threshold for VAT exemption for small businesses” and to  “enhance the VAT refund process to reduce the strain on working capital of businesses.”

    The committee acknowledged the need to balance tax relief with revenue generation.

    Oyedele however noted that “these proposals do not represent the position of the government but our committee’s proposals, which we are still undergoing discussions with the private sector for their input.”

    To address potential revenue shortfalls, the committee suggested the introduction of  “VAT fiscalisation and electronic invoicing to curb evasion.”  This would create a more transparent system and ensure businesses are paying their fair share.  Additionally, the committee proposed a  “consequential upward adjustment to the VAT rate on items not exempted” to maintain overall government revenue.

  • I didn’t propose increase in VAT rate, says Taiwo Oyedele

    I didn’t propose increase in VAT rate, says Taiwo Oyedele

    The chairman of the presidential committee on fiscal policy and tax reforms, Taiwo Oyedele, has said that reports he is proposing an increase in VAT rate have been quoted out of context.

    The Nation reported the committee suggested some changes to the current VAT rate, including increasing the state and local share of the VAT revenue to 90% combined.

    But Oyedele in a series of tweets on his official X page responded to reports that he suggested an increase in VAT.

    He said: “This is quoted out of context to suit the objective of the author, What are the issues?

    “Nigeria‘s VAT system places a huge burden on businesses as they are not allowed to claim the input VAT incurred on services and assets. Some items, which constitute basic consumptions (food, education, and healthcare) are liable to VAT rather than being exempt or zero-rated.

    “Many small businesses have to contend with VAT compliance in view of the existing low VAT exemption threshold for small businesses. Many States charge other forms of consumption taxes in addition to VAT thereby creating multiplicity of taxes. Export of services and intellectual property bear VAT rather than being zero-rated to promote exports.

    Read Also: Banditry, kidnapping responsible for declining school enrollment in Kaduna – Gov Uba Sani

    “What are we proposing? To address the above identified problems, we are proposing the following:

    “Full input VAT credit for businesses to reduce their cost of doing business and minimise the strain on their cash flows, remove VAT on an expanded list of basic food, educational and healthcare items to protect the poor.

    “Harmonise all consumption taxes into one (VAT only) and adjust the revenue sharing formula in favour of states to address multiplicity of taxes, remove VAT on export of service and intellectual property to promote non oil exports.

    “Increase the threshold for VAT exemption for small businesses, enhance the VAT refund process to reduce the strain on working capital of businesses, introduce VAT fiscalisation and electronic invoicing to curb evasion which makes honest businesses uncompetitive.

    “Consequential upward adjustment to the VAT rate on items not exempted to avoid a significant drop in revenue.

    “It is important to note that the above proposals do not represent the position of the government but our committee’s reform proposals which we are discussing with the private sector for their input.”

  • We need to raise VAT rate, says Taiwo Oyedele

    We need to raise VAT rate, says Taiwo Oyedele

    The chairman of the presidential committee on fiscal policy and tax reforms, Taiwo Oyedele, has said that there is a need to raise the value-added tax (VAT) rate.

    He said this on Monday while announcing that the VAT revenue-sharing formula would be reviewed.

    Oyedele spoke at a policy exposure and impact assessment seminar organised by the committee.

    He also said the committee proposed reviewing state and local government’s portion of VAT revenue to 90 percent combined.

    Section 40 of the VAT Act states that the federal government gets 15 percent of the tax revenue, states share 50 percent, and local governments share the balance of 35 percent.

    However, Oyedele said the committee suggested reducing the federal government’s share by 5 percent.

    He said: “We are proposing that the federal government’s portion should be reduced from 15 percent to 10 percent. States’ portion will be increased but they would share 90 percent with local governments.”

    According to Oyedele, the committee suggested changing the VAT distribution mechanism because it is a state tax.

    Oyedele said: “In 1986, we had sales tax collected by states. The military came up with VAT in 1993 and stopped sales tax so they said it would collect VAT and return 15 percent as the cost of collection and that is the 15 percent charged today came about. But we think it is too much,” he said.

    “So we must make it transparent and neutral and this is what over 100 countries where they have VAT are doing.

    Read Also: Taiwo Oyedele to deliver LagosCountry Club’s business forum lecture

    “Nigeria’s economy is more than 50 percent in services and if I just stop at this, many states will be broke because VAT collection will go down by more than 50 percent and it won’t even fly.

    “So we therefore need to adjust the VAT rate upward. We would ensure that it doesn’t affect businesses. The only thing is to look at basic consumption from food, education, medical services, and accommodation will carry zero percent VAT. So for the poor and small businesses, no VAT.”

    “We have spoken to businesses about it and they won’t increase the product price. We want to make sure when we do VAT reform, no one will increase the price of commodities. We will work the mathematics with the private sector.”

  • Tax defaulting politicians to be barred from contesting

    Tax defaulting politicians to be barred from contesting

    • Lawmakers to get Bill

    Should the proposed Executive bill be passed, politicians found guilty of tax evasion will be barred from seeking elective offices.

    The plan was made known yesterday by chairman of the Presidential Fiscal Policy and Tax Reforms Committee Taiwo Oyedele.

    He said an amendment to an existing tax law  will be sent to the National Assembly to ensure tax compliance and prevent default by the political class.

    Oyedele, who spoke at the 2024 strategic retreat for staff of the Joint Tax Board (JTB)  in Abuja, outlined key reforms on tax compliance among politicians and  the plan to set up a national tax amnesty programme.

    He said a proposed amendment to the existing tax law would disqualify those who fail to meet their tax obligations from running for political office.

    Oyedele said:  “We’re moving beyond a tax clearance certificate, which can be easily obtained. Effective compliance involves a thorough examination of tax declarations, filings, and payments to determine if a candidate is genuinely fulfilling his tax responsibilities as outlined in the constitution.

    “This issue arose during the last election. The argument was that the constitution doesn’t explicitly list tax compliance as a qualification criterion. We’re rectifying this oversight to ensure financial responsibility among those seeking public office.”

    Oyedele unfolded plans for a tax amnesty programme later this year titled: the “Voluntary Disclosure or Declaration Program.”

    Emphasising  the JTB’s role in the initiative, he said: “The term ‘amnesty’ can have negative connotations. However, the core objective is to encourage tax compliance. The JTB, as the leading tax coordination body, is perfectly positioned to spearhead this programme.”

    Oyedele reflected on the previously implemented Voluntary Assets and Income Declaration Scheme (VAIDS) programme, implemented previously, saying that “VAIDS could have achieved greater success if the JTB had been placed at the forefront, rather than acting as one stakeholder among many.”

    He added: “I recall a JTB meeting where I asked for a live response to the question of how many members supported VAIDS. To my surprise, over 50% indicated their disapproval.  This wasn’t about a lack of desire to collect taxes from evaders; it was about disagreement with the government’s approach.”

    “This time around, we’ll adopt a different strategy, ensuring not only the JTB’s involvement but also the collaboration of all stakeholders. We’ll work together to co-create a solution that addresses everyone’s concerns.”

    Read Also: FIRS boss calls for capacity building, tech adoption to address global tax challenges

    Oyedele also highlighted the proposed reforms that will transform the JTB’s role.

    He said: “We all recognise that the JTB’s mandate goes beyond personal income tax. The current reform package includes a draft law to replace the traditional tax return system. This will pave the way for the establishment of a new entity with a broader scope.

     “The name will change, but the JTB’s core function will remain: to coordinate and harmonize all taxes and levies, not just personal income tax.  It’s vital that you begin preparing for this new operating environment that’s just around the corner.”

    JTB Secretary OlusegunAdesokan emphasized the need for adaptation, saying: “Our domestic tax ecosystem is undergoing significant reforms. The JTB, with its critical role in tax administration, needs to be positioned to seize the opportunities that this transformation presents.”

    He added: “Achieving this goal requires the JTB Secretariat staff to embrace a culture of collaboration and innovation.  By fully comprehending their evolving roles within this new dispensation, they will ensure the JTB’s continued success.”

  • Taiwo Oyedele to deliver LagosCountry Club’s business forum lecture

    Taiwo Oyedele to deliver LagosCountry Club’s business forum lecture

    The Chairman of the Presidential Committee on Fiscal Policy and Tax Reform, Mr. Taiwo Oyedele, will deliver a lecture at the second edition of Lagos Country Club’s Business Forum on March 15 at 5 p.m.

    Oyedele, who is the guest speaker at the event, will speak on how to survive the nation’s tax regime under the theme: Nigeria’s Tax System: Implications for Business Competitiveness and Survival.

    Read Also: FG targeting N650/$ exchange rate by December, says Oyedele

    Other professionals expected at the event alongside Oyedele include President of the Manufacturers Association of Nigeria (MAN), Otunba Francis Meshioye; President of the Chartered Institute of Taxation of Nigeria (CITN), Mr. Samuel Agbeluyi; and the Executive Chairman of the Lagos Internal Revenue Service (LIRS), Mr. Ayodele Subair.

    The business forum, a brainchild of the Lagos Country Club, Ikeja, is a quarterly gathering which brings influencers in the society to share their wealth of ideas and knowledge to a select audience.