It said it became necessary to address the misunderstandings and misgivings around the tax reform already embarked upon by the administration following a meeting of the Northern Governors last Monday.

Bayo Onanuga, the Special Adviser to the President on Information and Strategy, argued this in an explainer titled, ‘Explainer: Proposed tax reform bills not against the north; they will benefit all states’ on Thursday.

At a meeting on October 28, 2024, Governors of the 19 Northern States, under the platform of the Northern Governors’ Forum, rejected the new derivation-based model for Value-Added Tax distribution in the new tax reform bills before the National Assembly.

The meeting also had traditional regional rulers, led by the Sultan of Sokoto, His Eminence Muhammadu Sa’ad Abubakar III, in attendance. A communiqué read by the Chairman of the forum, Governor Muhammed Yahaya of Gombe State, said the proposition negates the interest of the North and other sub-nationals.

President Bola Tinubu and the Federal Executive Council recently endorsed new policy initiatives to streamline Nigeria’s tax administration processes. The Federal Government said the new laws are meant to enhance efficiency and eliminate redundancies across the nation’s tax operations. The reforms emerged after a review of existing tax laws since August 2023. The National Assembly is considering four executive bills containing these tax reform efforts.

First is the Nigeria Tax Bill, which aims to eliminate unintended multiple taxation and make Nigeria’s economy more competitive by simplifying tax obligations for businesses and individuals nationwide.

Second, the Nigeria Tax Administration Bill proposes new rules governing the administration of all taxes in the country. Its objective is to harmonize tax administrative processes across federal, state, and local jurisdictions for ease of compliance for taxpayers in all parts of the country.

Third, the Nigeria Revenue Service (Establishment) Bill seeks to rename the Federal Inland Revenue Service as the Nigeria Revenue Service to better reflect the mandate of the Service as the revenue agency for the entire federation, not just the Federal Government.

Fourth, the Joint Revenue Board Establishment Bill proposes the creation of a Joint Revenue Board to replace the Joint Tax Board, covering federal and all states’ tax authorities. The fourth bill also suggests establishing the Office of Tax Ombudsman under the Joint Revenue Board, serving as a complaint resolution body for taxpayers.

The Presidency says the proposed laws will not increase the number of taxes currently in operation. Instead, they are designed to “optimize and simplify existing tax frameworks.”

Onanuga noted, “It is instructive to note that these proposed laws will not increase the number of taxes currently in operation. Instead, they are designed to optimize and simplify existing tax frameworks.

“The tax rates or percentages will remain the same under these reforms, as they focus on ensuring a more equitable distribution of tax obligations without adding to the burden on Nigerians.

“The reforms will not lead to job losses. On the contrary, they are structured to stimulate new avenues for job creation by supporting a dynamic, growth-oriented economy. Importantly, these laws will not absorb or eliminate the duties of any existing department, agency, or ministry. Instead, they aim to harmonize revenue collection and administration across the federation to ensure efficiency and cooperation.”

The Presidency noted that currently, Nigeria’s tax administration lacks coordination among federal, state, and local tax authorities, often resulting in overlapping responsibilities, confusion, and inefficiency. Without reform, this inefficiency will persist.

It said the proposed laws aim to “coordinate efforts between different tiers of government, resulting in better tax resource management and greater clarity for taxpayers.”

Under existing laws, taxes like Company Income Tax, Personal Income Tax, Capital Gains Tax, Petroleum Profits Tax, Tertiary Education Tax, Value-Added Tax, and other taxing provisions in numerous laws are administered separately, with individual legislative frameworks.

However, “The proposed reforms seek to consolidate these multiple taxes, integrating CIT, PIT, CGT, VAT, PPT, and excise duties into a unified structure to reduce administrative fragmentation,” said Onanuga.

On the proposed derivation-based VAT distribution model, which the Northern Governors oppose, the Presidency insisted that “the new proposal, as enunciated in the Bill, is designed to create a fairer system.”

It explained that the current model for distributing VAT is based on where the tax is remitted rather than where goods and services are supplied or consumed.

“The ongoing tax reform seeks to correct the inherent inequity in the current derivation model as a basis for distributing VAT revenue.

“The new proposal before the National Assembly outlines a different form of derivation which considers the place of supply or consumption for relevant goods and services.

“This means that states in the Northern region that produce the food we eat should not lose out just because their products are VAT-exempt or consumed in other states,” Onanuga stated.

According to the Presidency, these reforms are critical to improving the lives of Nigerians and were not put forward by President Tinubu to undermine any part of the country.

“There is no better time than now for the National Assembly to give due consideration to these bills that will overhaul our tax systems and create the revenue all the tiers of government require to fund the development our country and people urgently need,” it concluded.

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According to a statement released by his Special Adviser on Information and Strategy, Bayo Onanuga, the president will use the period to reflect on his administration’s economic reforms.

He said the leave is part of Tinubu’s annual vacation, but he is expected to engage in consultations during the break and will return to Nigeria after the leave ends.

Onanuga said: “President Bola Ahmed Tinubu will depart Abuja today for the United Kingdom to begin a two-week vacation, part of his yearly leave.

”He will use the two weeks as a working vacation and a retreat to reflect on his administration’s economic reforms.

‘’He will return to the country after the leave expires.”

For records, on Wednesday, May 8, the president returned to the country after more than one week. President Tinubu left Abuja on April 23 for the Netherlands on what the Presidency described as an official visit.

According to his ex-special Adviser on Media and Publicity, Ajuri Ngelale, the visit was on the invitation of the Dutch Prime Minister Mark Rutte. While there, Tinubu engaged in high-level discussions with the Prime Minister and the Dutch royalty, including His Royal Majesty, King Willem-Alexander and his wife, Queen Maxima.

Thereafter, he proceeded to Riyadh, Saudi Arabia, to attend a special World Economic Forum, WEF, meeting scheduled for April 28 and 29.

Bayo Onanuga, the Special Adviser to the President on Information and Strategy, revealed this to journalists at the State House on Wednesday, September 25.

Onanuga, who spoke at a press briefing, along with Senior Special Assistant to the President on Digital and New Media, O’tega Ogra, said there is no timeline as to when President Bola Ahmed Tinubu will reshuffle his cabinet.

It is worth noting that President Tinubu appointed his ministers in August of last year.

Meanwhile, President Tinubu has instructed his ministers to actively promote the accomplishments of his administration. According to Onanuga, Tinubu urged the ministers to “go out there and publicize the administration’s successes”.

He noted that some ministers were hesitant to speak publicly, adding, “Many Nigerians believe the president isn’t doing much, while the government is actually making significant strides.” Tinubu emphasized that his ministers should focus more on communicating these achievements to the public.

President Bola Tinubu on Monday 21, 2004,  swore in 45 ministers to a new cabinet that must get to grips with tackling the problems of sluggish growth, a weak currency and high inflation in Africa’s largest economy.

The ceremony took place nearly three months after Tinubu took office on May 29 after winning a disputed presidential election in February which is being challenged by his main opponents in court.

Onanuga’s comments were in response to a New York Times article which portrayed the Nigerian economy as deteriorating under Tinubu’s leadership. 

He noted that the economic difficulties were inherited and not a direct result of the president’s policies.

Bayo Onanuga pointed out that before Tinubu’s administration, Nigeria’s economy was already in an unstable state. The previous government had heavily subsidized both fuel and the exchange rate, with the Central Bank of Nigeria (CBN) spending approximately $1.5 billion monthly to maintain the naira’s value. 

This approach led to widespread arbitrage, where over 5,000 Bureau de Change (BDC) operators exploited the difference between the official and parallel market rates.

The Tinubu administration quickly recognized the unsustainable nature of these subsidies. One of the initial moves was to eliminate the fuel subsidy, a decision necessitated by the absence of budgetary provisions beyond June 2023. 

This step was essential in addressing the ‘cancer of public finance,’ which had seen 97% of revenue directed towards debt servicing under the previous government.

Simultaneously, the government floated the naira, allowing market forces to determine its value. This policy was aimed at curbing the rampant arbitrage and restoring investor confidence, which had waned due to inconsistent exchange rates and unmet remittance obligations to foreign businesses.

Despite initial turbulence, including the naira plunging to an all-time low of N1,900 to the dollar, Onanuga reported that stability is returning to the foreign exchange market. 

The naira has appreciated and now trades below N1,500/$, with optimistic projections suggesting it could strengthen further to between N1,000 and N1,200 by the year’s end.

In addition to stabilizing the currency, Nigeria recorded a trade surplus of N6.52 trillion in the first quarter of 2024, a turnaround from the N1.4 trillion deficit in the previous quarter. This positive trend, according to Onanuga, shows the initial success of Tinubu’s economic reforms.

Onanuga acknowledged the persistent challenge of inflation, particularly in food prices. He highlighted endless actions by both federal and state governments to boost agricultural production and reduce food costs. 

Initiatives include extensive investments in dry-season farming, distribution of fertilizers, and setting up retail shops in states like Lagos and Akwa Ibom to sell food at reduced prices.

The economic reforms have begun to restore international confidence in Nigeria’s financial stability. Notable indicators include the World Bank’s $2.25 billion loan and additional financial support from the African Development Bank (AfDB) and the African Export-Import Bank (Afreximbank). 

Through decisive policies and sustained reform efforts, the government aims to stabilize the economy and ensure a sustainable future growth.

A statement by Bayo Onanuga, special adviser to President Bola Tinubu on Information and Strategy: reads,

“The attention of the Presidency has been drawn to two fiscal policy documents in circulation that are being given wide coverage by the mainstream media and social media platforms.

“One of the documents titled Inflation Reduction and Price Stability (Fiscal Policy Measure etc) Order 2024 is being shared as if it were an executive order signed by President Bola Ahmed Tinubu.

“The other is a 65-page draft document with the title ‘Accelerated Stabilisation and Advancement Plan (ASAP)’, which contains suggestions on how to improve the Nigerian economy. President Tinubu received a copy of the draft on Tuesday.

“We urge the public and the media to disregard the two documents and cease further discussions on them. None is an approved official document of the Federal Government of Nigeria. They are all policy proposals that are still subject to reviews at the highest level of government. Indeed, one has ‘draft’ clearly written on it.”

According to the Coordinating Minister of the Economy, Mr. Wale Edun, ‘It is important to understand that policymaking is an iterative process involving multiple drafts and discussions before any document is finalised.’

“We assure the public that the official position on the documents will be made available after comprehensive reviews and approvals are completed.”

Emanating from the two documents have been reports second-guessing government’s policy on customs tariffs, fuel subsidy and other economic matters.

“The government wants to restate that its position on fuel subsidy has not changed from what President Bola Ahmed Tinubu declared on 29 May 2023. The fuel subsidy regime has ended. There is no N5.4 trillion being provisioned for it in 2024, as being widely speculated and discussed,” Edun stated.

The Coordinating Minister of the Economy further clarified: “As previously stated by government officials, including myself, President Tinubu announced the end of the fuel subsidy program last year, and this policy remains firmly in place.

“The Federal Government is committed to mitigating the effects of this removal and easing the cost of living pressures on Nigerians.

“Our strategy focuses on addressing key factors such as food inflation, which is significantly impacted by transport costs. With the implementation of our CNG initiative, which aims to displace high PMS and AGO costs, we expect to further reduce these costs.

“Our commitment to ending unproductive subsidies is steadfast, as is our dedication to supporting our most vulnerable populations”.

We call on the media to always exercise necessary checks and restraints in the use of documents that do not emanate from official channels so that the members of the public are properly informed, guided and educated on government policies and programmes.

Although, Rupani couldn’t give TECHECONOMY specific number of the CNG Vehicles currently available for delivery, our correspondent gathered that the company was commissioned to provide 200 CNG Vehicles for the FG’s initiative.

His words:

“We are working towards our deliverable, as we talk most of the vehicles are already available and been assembled now.”

Recall that JET Motor Company Electric Vehicles, is one of the four plants, said to have received  the SKD parts, coupling the buses in Lagos and working towards delivering 200 units before the first anniversary of the President Tinubu administration.

Other plants includes; Mikano, Mojo, and Brilliant EV.

While efforts to get update from Mikano proved abortive as there was no response to the inquires by our correspondent as at time of filing this report, earlier Mr. Bayo Onanuga, special adviser to the President on Information and Strategy, confirmed that the first set of compressed natural gas (CNG) vehicles will be inaugurated before Tinubu administration’s first anniversary on May 29.

According to him, the Federal Government allocated N100 billion from the N500 billion palliative budget to purchase 5,500 CNG vehicles (buses and tricycles), 100 electric buses, and over 20,000 CNG conversion kits.

He further explained this funding also supports the expansion of CNG refilling and electric charging stations.

“After months of detailed planning and background work, the committee driving the initiative is set to deliver on President Tinubu’s vision and promise.

The CNG Initiative was designed to deliver compressed natural gas especially for mass transit.

The Federal Government as part of the many intervention programmes to reduce the burden of increase in pump price on the masses, provided N100 billion (part of the N500 billion palliative budget) to purchase 5500 CNG vehicles (buses and tricycles), 100 Electric buses and over 20,000 CNG conversion kits, alongside spurring the development of CNG refilling stations and electric charging stations.

After months of detailed planning and background work, the committee driving the initiative is set to deliver on President Tinubu’s vision and promise.

The committee, being led by Michael Oluwagbemi, an oil and gas expert, has delivered some major foundational reforms to enable the new CNG and Electric Vehicles future the President promised. All is now ready for delivery of the first set of critical assets for deployment and launch of the CNG initiative ahead of the first anniversary of the Tinubu administration on May 29.

With necessary tax and duty waivers approved by President Tinubu in December 2023, the PCNGI committee is partnering with the private sector to deliver the promise on the initiative.

The private sector has responded with over $50 million in actual investments in refuelling stations, conversion centres, and mother stations.

Also, a safety policy document on 80 standards and regulations that must be strictly adhered to by operators has been developed and approved to ensure CNG conversions are done safely and reliably.

The deployment of CNG buses and tricycles and the vision to get at least one million natural gas propelled vehicles on our roads by 2027 will mark a major energy transition in our country’s transportation industry.

The use of more expensive diesel and PMS will gradually be phased out, when many vehicles, including trucks run on natural gas, which our nation has in abundance in at least 30 out of the 36 states of the federation.

Studies have shown that, one of the main causes of air pollution is primarily the amount of gases emitted by gasoline and diesel engines. To reduce the pollution, some countries of the world, such as India, China, Iran, Pakistan, Brazil , Argentina, Italy have built fleets of natural gas powered vehicles, instead of going the route of relying on liquid petroleum products propelled vehicles.

Natural gas vehicles reduce tail pipe emission by up to 40 percent, and Nigeria’s commitment to this course will enable her meet her nationally determined commitments (NDCs) under Paris Climate Accord to which we are signatory.

Hence, towards the end of May 2024, Nigeria will take some baby steps to join such nations that already have large fleets of CNG vehicles.

Remarkably, the Tinubu administration, in driving the nation to the desired destination, has flagged open a new industry, along with thousands of new jobs.

It also stated that about 2.5 million meters would be installed this year in a bid to bridge the metering gap across the country and ensure consumers pay the right amount for electricity.

On April 2, 2024, Bayo Onanuga, the special adviser to the President on Information and Strategy, stated that the move by government to withdraw electricity subsidy from 15 per cent of power consumers in Nigeria would save the government about N1.1tn annually.

Onanuga had said the President Bola Tinubu-led administration was poised to allow the price hike in electricity given its N450bn budget for energy subsidies in 2024. ⁣

But in a document on issues around the tariff hike, from the Federal Ministry of Power on Wednesday, which was made available by the media aide to the power minister, Bolaji Tunji, the government said it would save N1.5tn with the recent tariff adjustment.

It said, “FG (Federal Government) to save N1.5tn with tariff adjustment. FG still subsidising Bands below A. Pricing change will help improve liquidity to the NESI (Nigeria Electricity Supply Industry).

“Discos (power distribution companies) will be sanctioned for supplying less than 20 hours to Band A consumers.”

Last week, manufacturers and the organised labour had kicked against the hike in tariff payable by about 1.9 million consumers, which was approved and announced by the Federal Government on April 3, 2024.

Subsidy on electricity was withdrawn completely from the tariff of consumers on the Band A category, which constitute about 15 per cent of the total 12.82 million power consumers across the country.

The government announced the hike in electricity tariff at a press briefing in Abuja by the Nigeria Electricity Regulatory Commission, adding that those affected would pay N225 per kilowatt-hour, up from the previous rate of N68/kWh, representing about 240 per cent increase.

The government stated that the decision took effect on April 3, 2024, adding that Band A customers would enjoy up to 20 hours of power supply daily. However, there were several oppositions against the increase in tariff.

Meanwhile, the power ministry stated on Wednesday that the target of the Federal Government was to meter about 2.5 million unmetered power users across the country annually.

“The Presidential Meter Initiative aims to install a minimum of 2 – 2.5 million meters yearly within the next five years,” it stated.

A September 2023 report by NERC showed that out of the total 12,825,005 registered electricity customers in Nigeria, only 5,707,838 had meters, indicating that over 7.1 million registered customers were still subjected to the estimated billing system.

To close this gap, the Federal Government established the Presidential Metering Initiative, which was announced by Adebayo Adelabu, the minister of Power, at a briefing in Abuja.

Adelabu had put the metering shortfall at about eight million, but stressed that the Federal Government was committed to eliminating estimated billing by the end of 2024 and close the gap within the space of three to five years, through the new initiative.

“Citizens are tired of estimated billing because it always leads to cheating between consumers, staff and company. Before the end of this year, we are looking at the possibility of ending estimated billing because we want transparency and objectivity in our billing system.

“We have up to eight million metering gap in Nigeria and what the initiative seeks to achieve is to close this gap within three to five years. This means that an average of two million meters are required on a yearly basis and achieving the target is compulsory for citizens to enjoy stable power supply,” the minister had stated at a briefing in Abuja (Source).

Setting the record straight, Onanuga said:

“I said our government may impose heavy fines on Binance for what happened. I never said Binance had been informed about the fines or that it would definitely be $10 billion.

“I only said the amount may be imposed, which is because nothing has been finalised yet,” Onanuga explained.

Meanwhile, cryptocurrency giant Binance Holdings Ltd has refuted claims that it was in discussions with the Nigerian government regarding potential fines of up to $10 billion.

According to a Binance official quoted by an online newspaper, “We recently discussed ways to resolve issues with Nigeria, but we did not hear any demand for $10 billion.”

The crypto company made it clear that it is not amenable to negotiations with the Nigerian government regarding the restoration of its recently suspended services or the release of its executives, who are detained on suspicion of manipulating the naira to cause its collapse and subsequent economic consequences.

“Our goal is to establish positive relationships with Nigeria’s government and populace. Although we want to see the restoration of our services in Nigeria as soon as possible. We have no intention of paying fines for either staff or services,” it revealed.

This is following the appreciation recorded at the official end of the foreign exchange market on Tuesday.

Compared with the N1,551.24 which it closed on Tuesday, the naira had appreciated by 0.6 per cent on Wednesday compared to a 2.9 per cent appreciation recorded the previous day. On Tuesday, inflow at the NAFEM had increased from $68 million on Monday to $117.32 million, with intraday trading recording a low N1,701 and high of N1,100 trading to the dollar.

Inflow at the official market rose to $172.14 million with trades done between N1,755 an N1,050 to the dollar. The appreciation recorded at the official market, however, further widened the gap between the official and parallel market rates.

At the parallel market, the value has so far depreciated by at least 23 per cent between Monday and Wednesday when compared to N1,625 which it sold at the close of business last week.

The value of the naira at the parallel market varied by location with some traders quoting N2,010 to the dollars while some quoted N1,900, and N1,880 to the dollars. However, the volume traded and basis for the spike could not be determined as of press time.

Meanwhile, operatives of the Economic and Financial Crimes Commission have continued its raid on Bureau de Change operators which it said were hoarding dollars.

On Monday, it had raided some BDC operators at the Wuse Zone 4 area of Abuja and arrested about 50 illegal operators.

Similarly, not fewer than seven BDC operators and others were arrested by operatives of the EFCC on Wednesday in Kano state. The persons were arrested by the operatives who carried out a raid on the BDC operators at the popular forex exchange WAPA market in Fagge local government area of the state.

Malam Sani, the Chairman of the market, who confirmed the development to newsmen in Kano, said the operatives raided the market in search of hoarders of dollar, according to Leadership report.

Bayo Onanuga, a special adviser to President Bola Ahmed Tinubu, had also yesterday, accused crypto trading platform, Binance of manipulating the value of the naira.

In a post on X, Onanuga accused Binance of “blatantly setting exchange rate for Nigeria, hijacking CBN role.

But Binance denied it.