Why Nigerians are resisting new tax laws – Experts, activists speak

Nigerian economists and activ­ists have faulted the insistence of the federal government to commence implementation of the new tax laws on January 1 despite opposition from different quarters over legality.

Martin Onovo, a petroleum engineer and seasoned politician, one of those who x-rayed the com­mencement of the laws, described it as “a very rough take-off of the forged Tax Acts”.

Onovo, a political activist and the 2015 presidential candidate of the National Conscience Party (NCP), insisted that the Act “is not a law”, reports Sunday Independent.

Engr. Onovo, a petroleum sector player, now Head, Policy Positions, Movement for Fundamental Change (MFC), told our correspondent: “A law must be as passed by the legisla­ture and not as unlawfully proposed or forged by the Tinubu regime.”

He said: “The forged Act met re­sistance from multiple sides. It was resisted by the House of Representa­tives. It was rejected by civil society, and some citizens filed court cases against it.

“The Tinubu regime was forced to go back to the Act as passed by the legislature. The apprehension remains even after the Tinubu re­gime went back to the Act as passed by the National Assembly.

“More resistance will follow when our people realise the pernicious purpose of the Act. The Tinubu re­gime is the most wasteful and most corrupt regime ever in the history of Nigeria.

“It desperately extorts funds from Nigerians to fund its own waste and corruption. Tinubu Must Go!”

Baba Aye, another veteran activist, refused to agree that the new tax laws had a smooth take-off, noting that there were several divergent views behind the apprehension.

CONCEPTUALY CAPITALIST

Baba Aye, a Co-Convener, Coalition for Revolution (CORE), in his reaction, told our correspondent: “The concern for working-class activists is that the new tax regime aims to deepen accu­mulation of capital, including by turning the screws of ex­traction on us.

“It is part of the broader context of the neo-liberal regulation we have contin­ued to be made to bear since the struck adjustment pro­gramme laid the basis for this in the 1980s.”

Professor John Ebhomien, an economist and financial expert, told our correspondent that the rollout of Nige­ria’s new tax laws has been a mixed bag.

Ebhomien, a former World Bank/International Mone­tary Fund (IMF) consultant, and a chieftain of the All Progressives Congress (APC), stressed: “While the govern­ment had touted the reforms as ‘pro-people’ and aimed at simplifying taxation, critics argue that the implementa­tion has been marred by con­troversy and confusion.

Some of the teething is­sues, Ebhomien identified, included what he termed “Digital bottlenecks”.

On this he explained, “Users report­ed slow response times on tax portals and difficulties with registration and data verifi­cation.”

STAKEHOLDERS’ CON­FOUNDMENT

Another challenge, he stat­ed, is “Public confusion.” Ex­plaining this, he said, “Many small business owners and individuals remain unclear about new filing procedures and compliance timelines.”

Ebhomien also harped on “Allegations of unauthorised changes”, saying, “Opposi­tion lawmakers claim that the gazetted laws contain inser­tions never approved by par­liament, sparking concerns over constitutional breaches.

Professor Ebhomien add­ed: “Despite these challenges, the government has insisted on proceeding with the imple­mentation, citing the need for tax reform to boost revenue and efficiency.

“The new laws aim to ex­empt 98% of Nigerian work­ers and 97% of small busi­nesses from taxes or reduce their liabilities.

“For effective implementa­tion of this new tax policy, the government should adopt the following measures:

“First, the government needs to lead by example and prioritise transparency and accountability. Civic en­gagement is key to educating citizens and getting them on board with reform.

“Secondly, using profes­sional advertising agencies can help simplify complex policies and reach a wider au­dience. Plus, they will know how to cut through the noise and get the message across effectively.

“Town hall meetings and community outreach pro­grammes can provide a per­sonal touch, allowing citizens to ask questions and get direct feedback. This can build trust and ensure everyone is on the same page.

“Social media can ampli­fy the message and reach a broader audience, especially the youth. If properly har­nessed, it can drive engage­ment and foster a sense of inclusivity.”

INTRODUCING PROGRESSIVE TAX STRUCTURE

Bishop Herbert Ekechuk­wu, a cleric and an economist, in his contribution, stated that the new tax reform in Nigeria, which started on January 1, aims to simplify the tax sys­tem, reduce pressure on low income earners, and increase government revenue

Individuals earning N800000 or less per year, he added, are exempt from per­sonal income tax.

He noted: “The new tax system introduces a pro­gressive tax structure, where higher earners contribute a larger share of taxes with the highest rate at 25% for indi­viduals earning above N50 million annually.

“Small businesses with turnover below N100 million are exempted from company income tax, while medium and large scale company will pay 30% corporate tax.

“For now, it is too early to access the performance so far, but I can say that there is a misunderstanding and con­fusion over the whole issue.

“Many people are hearing it for the first time. Others do not know that it has started. Yet, others do not know how to fill out ‘NARRATIVE’.

“In summary, there was not adequate sensitisation of the general public on this issue. Government should liaise and collaborate with Non-Governmental Organisa­tions (NGOs) and media hous­es to enlighten the citizens on the new tax reform.”

Dr Rexkennedy Saltlove, a human rights activist, said the issue of tax is not a bad idea in the first place.

Saltlove, President/Execu­tive Director, Citizens Rights and Empowerment Advocacy Initiative (CREMA Initiative), who said he belongs to a plat­form or group where some of the members are financial gurus, said that at the prelim­inary stage of this tax matter, he was one of the persons to commend it.

MEETING STATUTORY OBLI­GATIONS

The public affairs analyst maintained that due to the growing population, and pressures on existing infra­structures, one of the ways the government can meet up its statutory obligations to the citizens by maintaining, upgrading and building new infrastructures to improve lives of its citizens, is taxing the citizens.

“But, where the challeng­es are is the corruption in the government where supposed ‘leaders’ enrich themselves, family members and associ­ates to the detriments of the citizens, common good of all and public interests through corruption and poor gover­nance.

“Another is, if through good governance, government is able to created jobs or favour­able businesses environment with guaranteed security and transparency in administering its policies, addressing those basic issues that confront vi­able business environments, taxing will not be a burden to citizens, but a thing of joy, as citizens will be proud to know that their taxes are their con­tributions, in building their nation and then have a sense of pride that drives crazy pa­triotism, even helping in pro­tecting the system.

“That said, now to your question: Starting with what is my rating on the smooth take-off of the new tax laws despite the initial apprehen­sion, I will give it a 7/10.

“There are many metrics in arriving at that and one of them is the regular public engagement of the citizens by the chairman, Presiden­tial Fiscal Policy and Tax Re­form Committee, Mr. Taiwo Oyedele.

“He is doing or has done an excellent job. He always tries to clear the grey areas through various media and engaging relevant bodies and organisations.

“More so, our elected rep­resentatives in the Senate and House of Representatives, who noticed dual versions of the tax documents, spoke out, for which we strongly be­lieve due diligence was given by those elected for oversight function and trust, it was the original tax law that was ga­zetted and signed into law.

“Secondly, the efforts made by those who went to court to obstruct the Acts being signed into laws, were defeated as the court struck out the suit, thus removing anything that could have been legal encumbranc­es against the tax laws.

“Some of the concerns raised by the Nigerian Bar Association (NGA) and civil society groups were much more on the tax policy imple­mentation and compliance, rather than on their formu­lations and being signed into laws.

“This future concerns made the signing of the tax laws a fait accompli with no adverse reaction of any sort.

“However, there is a strong indication that the federal government has paused issu­ing guidelines for implement­ing the new tax laws as they are not sure which version was actually signed.

“That is a subject for an­other day, but a welcome de­velopment.

“Government and tax re­form committee engaging citizens, willingness of citi­zens to comply as the bench­mark, was clear from where the taxing will start, with good breathing space for small-scale businesses, so the people do not collapse due to heavy taxation.

“The court striking out the objection against signing the bills into laws ensured its smooth take-off, which I rate at 7/10, which is an excellent pass mark I give this govern­ment. I have given 2 or 3/10 before on performance.”