In recent months, the Tax reform bills introduced by President Bola Tinubu continued to be debated, particularly among northern leaders. While the President remains resistant to these reforms, some northern politicians have urged him to align with the National Economic Council’s (NEC) recommendations. This body, which includes all 36 state governors and the Central Bank of Nigeria’s governor, has called for the bills to be withdrawn for further deliberation. Meanwhile, President Tinubu has stated plainly that the reforms are here to stay despite the growing outcry.
One of the vocal opponents of the reforms, Bauchi State Governor Bala Mohammed, expressed concern over the potential inequities in the current structure. He described the reforms as hasty and potentially unfair, warning that they could centralise Revenue streams at the federal level while depriving states like Bauchi of essential funds to address local needs. Mohammed hinted at a strong response from the governors if their concerns continue to be ignored, underscoring the dissatisfaction among northern leaders.
Regional and national discontent with the new development.
Despite the perception that opposition to the tax reform bills is regionally concentrated, prominent voices like Anthony Sani, a former Secretary General of the Arewa Consultative Forum, have clarified that the discontent is nationwide. Sani pointed out that the NEC, representing a cross-section of the nation, had urged the presidency to reconsider the bills to allow for broader consultations. He emphasised that the resistance is not limited to northern politicians but reflects concerns across the political spectrum.
According to Sani, while President Tinubu’s stance on the reforms may appear politically risky for his reelection prospects in 2027, the tax bills themselves are not directly tied to electoral politics. He argued that the President’s openness to dialogue on contentious aspects, such as Value Added Tax (VAT) distribution, would mitigate some controversies surrounding the reforms. The reforms have also drawn criticism from Civil Society groups and political activists. Yunusa Tanko, National Coordinator of the Obidient Movement, noted the disparity in the reforms’ impact on different regions.
Tanko addresses the ongoing economic challenges faced by Nigerians.
He noted that states like Lagos, hosting the headquarters of many large corporations, stand to benefit disproportionately from VAT collections. This unequal distribution, Tanko argued, exacerbates existing economic disparities and fails to reflect the broader national interest. Tanko’s critique also touched on the socioeconomic struggles facing many Nigerians. He stressed the urgency of addressing the immediate survival needs of citizens, many of whom are struggling with rising living costs. According to him, these reforms risk alienating voters struggling under the current economic pressures.
On his part, Yerima Shettima, National President of the Arewa Youth Consultative Forum, warned that the President’s unwavering stance could have significant electoral consequences in the northern region. Despite receiving advisories from influential northern leaders, including Governors Babagana Zulum and Bala Mohammed, Tinubu’s position has remained unchanged. Shettima noted that the President’s refusal to consider alternative approaches to the tax bills could alienate northern voters. This, he argued, might undermine Tinubu’s prospects in the 2027 elections.
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As the President navigates these complex dynamics, he faces the dual challenge of addressing immediate public concerns while laying the groundwork for sustainable economic growth, but amidst these controversies, it is essential to recognise the potential benefits of the tax reforms, particularly for the northern regions. The amendments include exemptions from Companies Income Tax (CIT) for businesses with annual turnovers below ₦50 million. Additionally, essential goods and services, including agricultural products, are exempt from VAT. These measures aim to ease the financial burden on small businesses and farmers, sectors that form the backbone of many northern economies.