In a significant development, Taiwo Oyedele, the Chairman of the Presidential Committee on Tax Policy and Fiscal Reforms, has recommended the suspension of Value Added Tax (VAT) on diesel as a strategic measure to mitigate the economic impact stemming from the removal of fuel subsidies. Oyedele shared this proposal during an appearance on Channels Television's Sunrise Daily breakfast program on Wednesday.
Elaborating on the committee's objectives, Oyedele expressed that the initial 30 days of their mandate are focused on addressing pressing issues that have long been acknowledged as challenges, yet remained unaddressed. Drawing parallels with the removal of fuel subsidy on petrol and the subsequent price increases, he suggested that suspending VAT on diesel could offer a balancing mechanism.
While Oyedele was careful to avoid making concrete promises, he highlighted the need to consider such measures in the context of ongoing reforms. The intention is to submit this proposal to the committee for consideration within the specified time frame.
Notably, Taiwo Oyedele, who formerly held the role of Fiscal Policy Partner and Africa Tax Leader at PriceWaterhouseCoopers (PwC), outlined the committee's broader objectives for the upcoming six months. These objectives encompass the implementation of vital tax reforms, the harmonization of tax laws, issuance of executive orders, and the rollout of essential regulations.
The Presidential Committee, inaugurated by President Bola Tinubu in Abuja on Tuesday, operates within a one-year timeframe to execute its policies. Oyedele clarified that the periods of 30 days, six months, and one year run concurrently, highlighting the urgency behind the proposed reforms.
Addressing revenue collection, Oyedele endorsed the Federal Inland Revenue Service (FIRS) as the optimal entity to manage revenue collection for ministries, departments, and agencies. Furthermore, the committee aims to delve into the issue of excessive bank charges, revealing that businesses are burdened by a multitude of levies and taxes, often numbering as high as 65 to 70. To streamline this complex landscape, the committee aims to significantly reduce the number of taxes to a more manageable count, approximately 10.
As the Presidential Committee on Tax Policy and Fiscal Reforms takes significant steps toward reshaping Nigeria's taxation landscape, Oyedele's recommendations highlight the proactive measures being explored to navigate economic challenges and promote a more equitable tax structure. The concurrent timelines emphasize the committee's commitment to delivering tangible results in a timely manner.
