Taiwo Oyedele, Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, has described the proposed tax bills currently before the National Assembly as the most worker-friendly reforms in Nigeria’s history. His remarks come in response to concerns raised by the Nigeria Labour Congress (NLC) over citizens’ welfare and inadequate stakeholder engagement in the development of the reforms.
The NLC, in a statement issued on Wednesday, called on the federal government to withdraw the tax bills, citing fears about their potential impact on the welfare of Nigerian workers.
Responding via a post on X (formerly Twitter) on Thursday, Oyedele clarified that the proposed reforms are designed to improve workers’ welfare and alleviate the economic challenges faced by citizens, especially low-income earners. He expressed confidence that the NLC would not intentionally act against the interests of its members.
“We welcome the interest of the Nigeria Labour Congress (NLC) on the Tax Reform Bills. We note the concern expressed about the likely impact on the welfare of Nigerian workers,” Oyedele wrote.
Highlighting key provisions of the bills, Oyedele outlined several measures aimed at enhancing workers’ welfare:
1. Lower Personal Taxes:
• Full exemption from PAYE (Pay As You Earn) tax for low-income earners earning up to ₦1 million annually (approximately ₦83,000 monthly), covering about one-third of workers in both public and private sectors.
• Reduced PAYE rates for workers earning up to ₦20 million annually (₦1.7 million monthly), benefiting an additional 60% of workers.
• PAYE tax exemption for members of the armed forces combating insecurity.
2. Cost Reduction on Essentials:
• Zero VAT on food, healthcare, and education, covering about 60% of household consumption.
• VAT exemptions on transportation, renewable energy, CNG, baby products, sanitary towels, and fuel products, representing over 20% of consumptions.
3. Support for Businesses and Employment:
• Tax exemption for 97% of small and medium enterprises (SMEs).
• Elimination of stamp duties on rents below ₦10 million.
• Tax incentives for employers to create jobs, including remote work opportunities for Nigerians.
Oyedele emphasized that the reforms are designed to stimulate economic growth and ease the rising cost of living for workers, particularly low-income earners. He noted that the tax bills include incentives to promote employment, harmonized corporate tax rates for large businesses, and measures to attract foreign investments.
Acknowledging the need for further dialogue, Oyedele called for robust debates and engagements during the legislative process to refine the bills. “We look forward to more opportunities to discuss specific areas for improvement in the bills to better serve the interests of all Nigerians, including workers,” he added.
The proposed reforms, if implemented, could reshape Nigeria’s fiscal landscape while providing relief to workers and fostering economic growth.
