President Bola Tinubu has taken a significant step towards removing barriers to business growth in Nigeria by approving the establishment of a Presidential Committee on Fiscal Policy and Tax Reforms. The committee, chaired by Mr. Taiwo Oyedele, a renowned expert in fiscal policy and taxation, will consist of professionals from the public and private sectors. Its mandate includes tax law reform, fiscal policy design and coordination, harmonization of taxes, and revenue administration.

According to the Presidential spokesman, Dele Alake, the decision to create the committee stems from President Tinubu’s recognition of the importance of a robust fiscal policy environment and an effective taxation system for the country’s government and economy. Nigeria currently ranks low in terms of the global ease of paying taxes, with a Tax to GDP ratio well below the African average. This overreliance on borrowing hampers socio-economic development, as debt service costs consume a significant portion of government revenue.

The committee will address key challenges in Nigeria’s tax system, including multiple taxes and revenue collection agencies, a fragmented and complex tax system, low tax morale, high prevalence of tax evasion, high cost of revenue administration, lack of coordination between fiscal and economic policies, and poor accountability in the utilization of tax revenue. Its primary objective is to enhance revenue collection efficiency, promote transparent reporting, and encourage voluntary compliance. By doing so, the committee aims to boost citizens’ tax morale, foster a healthy tax culture, and create a more conducive and internationally competitive business environment.

The committee, while advising the government on necessary reforms, will also drive the implementation of its recommendations. The Chairman, Mr. Taiwo Oyedele, is a highly accomplished professional with extensive expertise in fiscal policy, taxation, and economic matters. He currently serves as the Africa Tax Leader at PriceWaterhouseCoopers (PwC) and holds important positions in prestigious organizations, including the Nigerian Economic Summit Group (NESG) and the Institute of Chartered Accountants of Nigeria (ICAN). He is also a member of global tax and accounting bodies, as well as an Associate Professor at the Babcock University Business School.

President Tinubu’s establishment of this committee reflects his commitment to transformative fiscal policy and tax reforms in Nigeria. The government aims to achieve a minimum Tax to GDP ratio of 18% within the next three years without stifling investment or economic growth. By enhancing revenue collection and promoting transparent utilization of tax and other revenues, the committee will contribute to sustainable development and create a more favorable investment climate.

The committee’s work is expected to have a positive impact on Nigeria’s revenue profile, paving the way for economic growth and improved public services. As the implementation of reforms takes place, the government will closely monitor progress and ensure that Nigeria’s fiscal policies and tax system align with the country’s long-term development goals.