The Joint Committee on Appropriations in the National Assembly has called on the federal government to halt the granting of tax waivers and concessions to corporate entities. The committee argues that the country is experiencing significant revenue losses due to these concessions and suggests that companies should pay their taxes in full to the government before applying for rebates.
During an interactive session on the 2024 budget with Finance Minister Wale Edun and Budget and Economic Planning Minister Atiku Bagudu, Senator Adeola Olamilekan, the committee’s chairman, and other members expressed concerns about the substantial revenue losses attributed to tax waivers and incentives.
Chairman of the Presidential Fiscal Policy and Tax Reforms Committee, Mr. Taiwo Oyedele, had previously stated that the country incurs annual losses of up to N6 trillion in tax waivers. The Finance Minister, Wale Edun, informed the panel that Nigeria lost over N3 trillion to tax waivers in the current year.
Senator Mohammed Sani Musa proposed adopting a system similar to withholding taxes for tax waivers, where companies would receive rebates after proving full tax payment. Senator Ali Ndume urged the government to boldly stop tax credits and waivers, drawing parallels with the bold decision to eliminate fuel subsidies.
Senator Adeola suggested a gradual reduction of 50% in the provision for waivers during the transition period. The Finance Minister acknowledged the committee’s advice, assuring that it would be considered by the federal government’s fiscal policy and tax reform committee. Edun emphasized the need to carefully assess the practicality of implementing such policies and to determine possible exceptions.
He stated, “We should try as much as possible to move to a rebate system rather than up-front granting of waivers and other incentives.” The fiscal policy and tax reform committee will consider the input provided by the lawmakers in their ongoing work.
