FG Plans to Cut Over 50 Taxes to Improve Nigeria’s Tax System

The Federal Government is planning big changes to make Nigeria’s tax system simpler and fairer by getting rid of more than 50 unnecessary taxes.

During a meeting in Asaba, Delta State, Mrs. Rebecca Nasamu, speaking for Mallam Lanre Issa-Onilu from the National Orientation Agency (NOA), explained the plans. The new Nigeria Tax Bill will combine all important taxes into one clear list and remove 11 old tax laws. This will help people with lower incomes because they will pay less or no taxes.

One major update is changing how Value Added Tax (VAT) is calculated. It will now be based on where things are bought and used instead of where a company is based. This change aims to make taxes fairer and use new digital tools to make paying taxes easier and clearer.

At the 2024 National Tax Conference in Abuja, groups like CISLAC, ActionAid, and Oxfam Nigeria, along with government agencies, pushed for these tax changes to focus on fairness. They worried about increasing VAT during high inflation, which is over 30%, and suggested making things like electricity, cooking gas, and basic foods tax-free.

These groups also said that big companies and wealthy people should pay more taxes. They warned against tax changes that could make it harder for people with low incomes to afford things.

The government’s new tax plan aims to bring all tax laws together, use digital systems for tax collection, and help people who need it most. “By supporting these changes, we aim to build a tax system that works for everyone and helps fund projects that improve our country,” Issa-Onilu stated.