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The subject of tax in Nigeria has taken an interesting turn with the new suggestion from the fiscal policy and tax reforms committee. For over a year now, there has been debate on whether to tax Nigeria’s informal sector or not.
There has also been a discussion surrounding the feasibility of such an initiative.
A report seen in the Nigerian newspaper, The Cable shows that the fiscal policy and tax reforms committee is advocating for tax relief for Nigeria’s informal sector. This is a far cry from the tax reform proposed back in July 2023 by the then-new administration.
The report notes that the federal government is developing a system that would offer tax relief to 95 percent of the informal sector. This was disclosed by the head of the presidential fiscal policy and tax reforms committee, Taiwo Oyedele at the closing session of the committee in Abuja on Sunday.
As stated by the chairman of the presidential fiscal policy and tax reforms committee, the idea is to free companies making N25 million or less annually from the several levies that impede their development over time.
“So, we think that 95 percent of the informal sector should be legally exempted from all taxes; withholding tax, company income tax, even payee on their staff,” he said.
”We’re using data to inform our decisions. Currently, if you earn N25 million a year or less, you don’t have to pay company income tax, you don’t have to worry about VAT. We think that the informal sector is people who are trying to earn a legitimate living, we should allow them to be and support them to grow to a point where they can then have the ability to pay taxes,” he added.
Taiwo Oyedele also disclosed that the new tax measures being considered will primarily target the middle class, the wealthy, and the top 5 percent t of that industry. — Business Insider Africa.
Online Reporter