Taiwo Oyedele, chairman of the presidential committee on fiscal policy and tax reforms, has described the proposed tax bills as “the most pro-workers” reforms in Nigeria’s history.
Oyedele was responding to concerns raised by the Nigeria
Labour Congress (NLC) on citizens’ welfare and poor stakeholders’ involvement
in the development of the tax reforms.
The NLC, on Wednesday, also asked the federal government to
withdraw the tax bills currently before the national assembly.
Responding in a post on X on Thursday, Oyedele said the
bills will improve workers’ welfare, noting that the tax committee believes the
NLC will not intentionally work against its members’ interests.
“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,” he wrote.
“To clarify, we outline below some of the key provisions of
the tax bills aimed at improving the welfare of workers:
“1. Lower taxes to enhance the disposable income of workers
– a) Full exemption of low-income earners up to N1m p.a. (about N83k per month)
representing about one-third of all workers in the private and public sectors
from PAYE tax.
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“(b) Reduced PAYE tax for workers earning up to N20m p.a.
(about N1.7m per month) benefiting additional 60% of all workers.
“(c) PAYE tax exemption for members of the armed forces
fighting insecurity in addition to other ranks.
“2. Measures to reduce the cost of essential items – a) Zero
(0%) VAT on food, healthcare, and education representing about 60% of all
consumptions.
“(b) VAT exemption on transportation, renewable energy, CNG,
baby products, sanitary towels, and fuel products representing over 20% of all
consumptions.
“These items constitute an average of 82% of household
consumption and nearly 100% for low-income earners to ameliorate the rising
cost of living for workers.”
Oyedele also said in the proposed reforms, tax is exempted
for 97 percent of small and medium enterprises (SMEs), and stamp duties on rent
below N10 million as part of the perks for workers.
He said the proposed bills make provisions for incentives to
stimulate employment opportunities for workers, including “tax incentives for
employers to hire more workers”.
“(b) Friendly tax rules to attract remote work opportunities
for Nigerians,” he added.
“(c) Tax exemption for 97% of SMEs, harmonisation and
reduction of corporate tax rates for large businesses to stimulate growth and
create more employment opportunities for workers.”
Oyedele said the tax bills can be further improved through
robust debates and engagements, which can take place as part of the ongoing
legislative process.
He said the committee looks forward to more opportunities to
discuss specific areas for improvement in the bills to better serve the
interests of all Nigerians, including workers.
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