In a statement released by the Special Adviser on Media and Publicity to the Speaker of the House of Representatives, Rt. Hon. Abbas Tajudeen, Ph.D, the Speaker addressed ways in which the 10th National Assembly can legislatively address Nigeria’s current economic challenges, emphasizing the importance of tax reforms as a key focus area already outlined in their Legislative Agenda.
Speaking at the commencement of a two-day retreat for members of the Senate on fiscal policy and tax reforms in Uyo, Akwa Ibom State, Speaker Abbas highlighted the National Assembly’s proactive stance in responding to economic challenges and promoting reforms that facilitate ease of doing business.
He emphasized the 10th House’s commitment to collaborating with the Executive and stakeholders to enhance the coherence of the tax system. Economic restructuring stands as the Fourth Legislative Priority in their Agenda, encapsulating their dedication to supporting economic diversification and reducing reliance on oil revenue. This includes the development of sectors like mineral resource mining, manufacturing, agro-processing, textile, tourism, technology, and general services.
Speaker Abbas indicated the intention of the 10th National Assembly to employ legislative measures to provide tax incentives aimed at stimulating innovation and fostering job creation and export growth. They are also keen on supporting the implementation of the African Continental Free Trade Agreement (AfCFTA) to promote economic cooperation and growth. Additionally, efforts to streamline business registration, reduce bureaucratic hurdles, and simplify the tax system have been prioritized to encourage economic growth.
The Speaker posed critical questions to guide the retreat’s discussions, including simplifying the tax system, evidence-based tax structure design, and optimizing the functionality of the revenue authority. He stressed the importance of effective oversight to ensure tax revenues are put to optimal use for the benefit of the Nigerian people.
Speaker Abbas reaffirmed the House’s commitment to working in tandem with the Senate to address the nation’s challenges through appropriate legislative frameworks and measures. He eagerly anticipated the outcomes of the retreat and pledged to act upon them accordingly.
Highlighting the relevance of the issue under consideration, Speaker Abbas noted that the slow progress towards economic diversification had left Nigeria’s economy vulnerable to fluctuations in global oil prices. He cited the growing gap between government revenue and expenses, particularly the 2023 budget deficit, which is expected to exceed N10 trillion and is primarily being financed through borrowing.
While acknowledging Nigeria’s relatively low debt-to-Gross Domestic Product (GDP) ratio compared to other countries, Speaker Abbas expressed concerns over the high proportion of revenue allocated to debt servicing, which can limit fiscal flexibility for other developmental needs. Inefficiencies in tax collection, including evasion, weak enforcement, and the existence of a large informal sector outside the tax net, have further compounded the economic challenges.
Multiplicity and duplication of taxes were identified as other factors hindering the efficiency of Nigeria’s tax system. The Speaker cited significant progress in improving the World Bank Ease of Doing Business Ranking, partly attributed to legislative and executive measures that have enhanced the country’s business environment.
These remarks by Speaker Abbas underscore the 10th National Assembly’s dedication to addressing Nigeria’s economic challenges through legislative means, with a primary focus on tax reforms and economic diversification.
