The Federal Government is eyeing a single-digit tax system to reduce the burden of multiple taxation on Nigerians.
Chairman of the Presidential Committee on Fiscal and Tax Reforms, Taiwo Oyedele, disclosed this in an interview on Channels Television.
Oloyede explained that upon completion of the ongoing reforms, all taxes would be reduced to single digits.
The single-digit tax system allows citizens or businesses to pay less than 10 taxes within a given period.
He said this in an interview themed 'Tax Reform: Why States Shouldn't Collect VAT', noting that his committee has launched an initiative to enhance cooperation between tax authorities and states in terms of data, tax intelligence and capacity building. Outline has been prepared.
“Our hope is that when we complete our reforms, all taxes will be reduced to single digits,” Oyedele said.
“We want officers trained on tax matters to collect taxes while others focus on primary mandates and see the economy grow in a way that benefits everyone,” Oyedele said.
“The Nigerian Tax Administration Bill is our objective to endeavor to use technology for registration of taxpayers, filing of returns, assessment, tax audit and tax administration. We are in dialogue with legislators and we believe Nigerian lawmakers have concerns and we want to summarize the bill for them,'' Oyedele added.
He described the situation as 'shameful' and said the Nigerian tax system is one of the most backward in the world.
“We are in 2024, and anything that will stop the reforms of Nigeria's tax system will be really sad and I think we can work out the differences to continue the process and enact the bills.”
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On his
“The plan is to reduce the overall tax burden, not increase it. By simplifying the tax system, harmonizing taxes and removing barriers to investment, the reforms will boost economic activities and therefore increase revenue generation for all levels of government,” Oyedele said.
He outlined the strategies that the government will implement to ensure that tax revenues are increased without increasing the tax burden. Such strategies include: removing disincentives to formalize business, use of technology, data for intelligence and tax simplification.
“This will ensure that we can increase tax revenues without increasing the tax burden, through various strategies, including removing disincentives for business formalization, use of technology and data for intelligence, tax simplification and enhanced administrative Capacity included. Apart from increasing revenue, curbing tax evasion also ensures that there is a level playing field for all instead of indirectly punishing compliant taxpayers and rewarding evaders.''
He said the government's reforms will benefit small and large businesses as there will be a harmonized single levy at a lower rate.
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“Some of the proposals include reducing the corporate income tax rate from 30 per cent to 25 per cent over the next 2 years and introducing a harmonized single tax at a lower rate by eliminating fixed taxes on companies,” he said.
The development follows public outcry over multiple and increasing taxation by the administration of President Tinubu.
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