Tinubu Tax: Negotiation As Northern Groups, ACF, NEF, AYCF List Conditions

.…. to cease fire

•State Revenue Board raises questions for review c’tte

Following the opposition, especially from the North against the proposed Tax Reform Bills in the National Assembly, NASS, leading northern groups have listed conditions to stop opposing the bills
They insisted that their opposition to the planned fiscal laws stems from the potential impact of the reforms on the economic conditions of the North.

Hence they demanded commitment to addressing what was described as historical inequalities that have contributed to the under-development of the region, listing accountability, transparency, expanded consultations and building of trust as conditions to support the bills.

President Bola Tinubu had ordered a review of the bills to address growing concerns.
Specifically, he directed the Ministry of Justice to work closely with NASS to address the issues within and outside the legislature.

Federal Government has repeatedly said the bills are aimed at overhauling the nation’s tax system.
The proposed laws, which have passed Second Reading in the Senate, include Nigeria Tax Bill 2024, Nigeria Tax Administration Bill, Nigeria Revenue Service, Establishment, Bill, and Joint Revenue Board, Establishment, Bill.

But notable regional groups, including Northern Elders Forum, NEF, Arewa Youth Consultative Forum, AYCF, and Arewa Consultative Forum, ACF, told Sunday Vanguard that anything short of their conditions for cessation of hostilities may not address the fears of the North.

Spokesman for NEF, Abdul-Azeez Suleiman, said a simple cessation of hostilities is insufficient, noting that sustainable peace requires addressing the underlying grievances and building trust.

Negotiations
His words:”In my opinion, a ceasefire on the controversy surrounding President Tinubu’s tax reform bills is achievable, but only through a concerted effort towards genuine negotiation.

“This necessitates inclusivity, transparency, accountability, and a commitment to addressing the underlying socio-economic challenges of Northern Nigeria.

“It requires walking a tightrope between the need for fiscal responsibility and the imperative of social justice.

“The path to resolution is fraught with complexities, requiring a nuanced understanding of the diverse perspectives at play and a commitment to dialogue. “A simple cessation of hostilities is insufficient; [/b]rather, a sustainable peace requires addressing the underlying grievances and building trust.

[b]Poverty

“The core of
the opposition stems from concerns regarding the potential impact of
these reforms on the already strained economic conditions of Northern
Nigeria.

“The region grapples with significant challenges – from poverty and unemployment to limited access to education and healthcare.

“Many
fear that the proposed tax increases, without accompanying measures to
alleviate these existing pressures, will disproportionately burden the
most vulnerable populations, exacerbating existing inequalities and
fueling social unrest. This fear is not unfounded.

“The lack
of transparency in the initial presentation of the bills, coupled with
the perceived absence of adequate consultation with regional
stakeholders, has further inflamed these concerns.

“This has
led to a perception that the reforms are being imposed rather than
negotiated, feeding into existing anxieties about marginalization and
unequal distribution of resources.

“The call for negotiation,
therefore, is not merely a tactical manoeuvre but a fundamental
requirement for restoring confidence and achieving a lasting ceasefire.

Inclusivity
“The first crucial condition for successful negotiation is genuine inclusivity.
“The
dialogue must not be limited to a select group of elites but must
actively involve representatives from all segments of Northern society –
from farmers and traders to professionals and religious leaders.

“Their
diverse perspectives and concerns must be actively sought and
integrated into the process. “This demands a conscious effort to bridge
the communication gap between the federal government and the Northern
populace, ensuring that information is disseminated transparently and
that concerns are addressed directly and honestly.

“Furthermore, any meaningful negotiation must be predicated on a commitment to transparency and accountability.

“The
government must provide clear, detailed explanations of the rationale
behind the proposed tax reforms, outlining how the revenue generated
will be utilized to benefit the northern region specifically. “This
includes outlining clear plans for the improved provision of public
services like healthcare, education, and infrastructure.

“Simply
stating that the reforms are necessary for national development is
insufficient; a concrete plan demonstrating tangible benefits for the
North is essential.

Inequality
“This transparency
should also extend to the process of revenue allocation and expenditure,
ensuring that the people see the direct benefits of their
contributions.

“Equally important is the establishment of
independent monitoring mechanisms to ensure accountability and
transparency throughout the implementation process.

“An
independent body, comprising representatives from both the government
and civil society, could be tasked with overseeing the implementation of
the reforms and reporting regularly on their impact on the Northern
region.

“This will help build trust and alleviate fears of misuse or misappropriation of funds.
“Finally,
a ceasefire requires a genuine commitment to addressing the historical
inequalities that have contributed to the current crisis.

“The North has long faced systemic challenges that have hindered its economic development.
“These include limited access to credit, inadequate infrastructure, and a lack of investment in human capital.

“Addressing
these structural issues is not merely desirable but essential for
building a sustainable and equitable future for the region.

“The
tax reforms, if properly integrated into a broader strategy of regional
development, can play a positive role in this process.

“However,
this requires a significant investment in capacity building,
infrastructure development, and targeted social programs designed to
alleviate poverty and create opportunities for economic advancement.”

Not carried along
Similarly,
President of AYCF, Yerima Shettima, lamented that the region wasn’t
carried along by its elected representatives during the formulation of
the bills.

He, however, called for a more participatory approach
that involves dialogue and addresses the specific concerns of the North
before implementation.

His words:”The position of the
AYCF, a significant demographic group in Northern Nigeria, on this
complex issue, requires careful consideration of our socio-economic
context and perceived impact of the bill on our communities.

“While
a monolithic stance is unlikely, our concerns generally revolve around
equity, fairness, and the potential for disproportionate burden on the
Northern region.

“Our primary concern stems from the
perception of inequitable distribution of resources and infrastructure
development across the country.

“We believe that despite
contributing significantly to the national GDP through agriculture and
other sectors, the North historically receives less in return in terms
of public services, infrastructure investment, and developmental
projects. “Consequently, the introduction of new taxes, without
addressing this existing imbalance, is viewed with skepticism.

“They
believe that increased taxation without corresponding improvements in
infrastructure – roads, schools, hospitals, would unfairly burden a
population already struggling with poverty, unemployment, and limited
access to essential services.

Economy
“Another key concern is the potential impact of the tax reforms on informal sectors which heavily dominate the Northern economy.

“A
large portion of the Arewa youth population is employed in the informal
sector – agriculture, small-scale businesses, and artisanal trades –
which often operates outside the formal tax net.

“The
implementation of the tax reforms bill, particularly if it extends tax
obligations to the informal sector, could pose a significant challenge.
“We fear that increased tax burdens could cripple these businesses,
leading to job losses and further economic hardship.

“The
lack of adequate education and awareness about tax regulations also
exacerbates this concern. “Many young people in the informal sector lack
the knowledge and resources to understand and comply with new tax laws,
potentially leading to fines and penalties, further marginalizing them
economically.

“Furthermore, our position is also influenced by the perceptions of governmental transparency and accountability.

“Mistrust in government institutions and concerns about the proper utilization of tax revenue are prevalent.

“We
question whether the increased tax revenue generated will be
effectively utilized for the benefit of all Nigerians, or if it will be
mismanaged or disproportionately benefit certain regions.

Corruption
“Concerns
about corruption and lack of accountability in government spending
further fuel this skepticism and contribute to our reluctance to embrace
the tax reforms without robust guarantees of transparency and equitable
distribution of resources.

“The lack of visible development
projects and infrastructure in the North, despite past tax
contributions, strengthens our belief that increased taxation without
guarantees of responsible governance is unproductive.

“The
absence of robust engagement and consultation with the Arewa youth by
Northern Senators during the formulation of the tax reforms bill is a
point of considerable frustration.

“We feel our concerns
and perspectives have been largely ignored in the decision-making
process. This lack of inclusivity fuels our distrust and reinforces our
opposition to the bill in its current form. We call for a more
participatory approach that involves meaningful dialogue and addresses
our specific concerns before implementation.”

Dialogue
Also
speaking, National Publicity Secretary of ACF, Prof Tukur Muhammad
Baba, said:” As an organisation, ACF is yet to say anything publicly on
the tax reform issue.

“It’s already looking like the Federal
Government has agreed for dialogue on critical or contentious aspects of
the proposed bills.

“Already, the Attorney-General of the
Federation is billed to appear before the Senate on the bills. If
anything, it’s probably now that ACF should come out to urge all
parties, for or against the bills, to negotiate on truth, honesty and
sincerity of purpose for the good of the nation.”

Seaports

Meanwhile,
Executive Chairman of Borno Internally Generated Revenue Service,
BoIGRs, Professor Ibrahim Bello Alhaji, told Sunday Vanguard that there
is desire by economically advantaged states to subjugate the
less-privileged ones.

Alhaji said such a situation would not augur well for the country.

The professor of economics said, “To
all that have devoted time to read and understand the analogy, they
would have noticed the intense desire and ego by the economically
advantaged states to subjugate the less privileged ones, a development
that would not augur well for the country as a whole.

“As is common in all countries, endowments, socioeconomically and otherwise, differ between the different regions in Nigeria.

“The variation in endowments implies different growth prospects for the different states.

“The
sea ports in Lagos for example, along with other socioeconomic
antecedents, have made the South-West region a prominent industrial
location.

“The vast crude oil deposit in the South-South has made
the region vibrant in generating revenue for the country, while the
northern part of the country is blessed with agricultural and solid
mineral resources.
“In addition to the sea port in Lagos, the
South-West region is advanced in terms of socioeconomic infrastructure
and security and this make their economies relatively more stable.

“Those
from the other regions particularly the North, are left to suffer all
forms of social vices from massive infrastructural decay to pervasive
unemployment, stinking poverty level and extreme insecurity.

“It
is these unfavorable outcomes that necessitated the relocation of most
of the few industrial outfits from other parts of Nigeria to Lagos and
its surroundings, thereby improving the economic fortunes of all the
states within that region.

“Nobody can deny these states the resultant windfall which comes to them in all forms.

Most favoured
“To
this end, Lagos is the most favored state in Nigeria and, for a long
time, it has been a major center of industrialization not only in
Nigeria but also across the African continent.

“To vividly
expose both the short and long run implications of the proposed VAT
review policy, we would need the proponents to answer the following
questions:

“Considering the so many socioeconomic problems
of majority of the states in Nigeria today with attendant adverse
consequences on the local populace, what informed the need for gradual
upward review of VAT?
“What informed the decision to request for
as high as 60% of the entire VAT proceeds at a time the South-West is in
the forefront in revenue generation and is continuously receiving
migrant businesses previously headquartered in other states?

“Assuming
the proposal for review from 20% to 60% scales through as it is, would
this not trigger further tremor for sharing and re-sharing vis-a-vis
other treasures of the commonwealth?

“Have the proponents not
envisaged that the proposed abrogation of multiple local taxes
enshrined in the new policy can decapitate weaker states revenue wise?

“What
compensatory arrangement is being proposed for the victimized states
that would invariably suffer double-edged loss: having their hitherto
70% share reduced to 30%, and the abrogation of a large number of local
taxes that previously constitute major source of revenue to them.

Equity Fund

“What
evidence have the advocates to prove that a mere 5% equity fund
proposed to be put in place would be enough to offset the above two
adverse effects and other unforeseen defects on the economy of the weak
states?

“Would this apparent segregationist growth policy not
impact negatively on economic growth and further widen income inequality
between states and among the citizenry?

“Apart from the
perceived increment in revenue generation, which we fully know is not
‘an end in itself’, would higher VAT in a mono-cultured economy not
erode purchasing power and slow down the pickup of cottage industry and
economic diversification?

“Would the resultant dwindling
revenue in majority of the states, following abrogation of local taxes,
not cripple the need for infrastructure for industrialization and
governance generally?

“Would the combine effects of the above
not adversely affect employment opportunities, income generation,
economic growth and, by extension, further depreciate the national
currency? (Naira exchange rate).
“Would the policy not result to skewed and uneven development of the different regions?

Sacrifices
“Is
it justifiable to copy advanced countries like Belgium, UK, France,
Italy or even South Africa and Kenya being erroneously quoted by the
proponents as our equals, in total disregard of the sacrifices and
commitments they have made towards nation-building and their achievement
over the past few decades?

“Surely, it is not just about skin
colour and/or sheer ego, but about doing the right thing and getting it
right from the beginning, persistently all through to the end.

“Why
not cite example of countries within the same poor income status, the
same infrastructural decay, the same demographic, cultural and political
problems so that the antidote to be proposed would appropriately and
directly address the identified constraints?

“For how long
shall we continue to waste valuable time copying countries with whom we
differ in so many respects instead of developing our own growth model?

“Are
there no countries with only a negligible VAT% or even 0% VAT and yet
fulfilling their socioeconomic goals, carrying all units, weak and
strong to the promise land?

“Why are the tax practitioners and other relevant bureaucrats not included in the review committee?

“Why
is the composition of the advisory committee not reflective of the
country’s diversity so that from the on-set all opinions, arguments and
counterarguments would have been resolved?

“As satisfactory
answers to the above questions are most unlikely, I dare to say that to
whichever side of the coin, it goes without contradiction that the
Nigerian economy is sick, so sick that it is in a state of emergency.

“First,
a proper diagnosis is required to know what exactly the cause of the
sickness is. “The next step is to refer her (the country) to the
appropriate specialist to professionally prescribe the antidote to the
underlying cause.

“In conclusion, the country Nigeria belongs to all of us, and we must respect each others’ interest.”

Taraba, Kwara
Similarly,
Corporate Affairs Manager of Kwara State Internal Revenue Service,
Funmilayo Osagbemi, told Sunday Vanguard that the revenue service has
not taken any position on the Tax Reforms Bills, saying the issue is
still ongoing.

She said: “We are following up the debates and
conversations about the Tax Reforms Bills. We are prepared. In concrete
terms, we can’t take any position now until the debates are completed
and we have real details before us. But we are ready for it.”

Also
speaking, Chairman of Taraba State Board of Internal Revenue ,TBIR,
Brig Gen Jeremiah Faransa ,retd, said the tax bills would significantly
benefit the country.

He[b] said: “I don’t want to comment much on
it because it is before the National Assembly. However, I know the
present administration means well, even if people are sceptical.
Previously, we were running what could be described as a ‘dummy
economy,’ but this government has been transparent about the state of
things.
[/b]

“For example, the bills propose relief for businesses with a turnover of ?50 million or less. Additionally, federal government will take only 10% of VAT, while states and local governments will share the remaining 90%. There will also be no taxes imposed on the common man.”

Source:- Vanguardngr