The Senate recently passed for second reading the four tax reform bills sent to it by President Bola Tinubu with the belief that the controversy associated with some provisions of the bills may be addressed during the public hearing. Sunday Aborisade reports.
The Senate last Thursday passed the tax reform bills for second reading amid tension despite a one hour close-door session to calm frayed nerves so that the federal lawmakers csn have a smooth debate on the general principles of the fiscal legislations.
The proposed landmark bills are the Nigeria Tax Bill; the Nigeria Tax Administration Bill; the Nigeria Revenue Service Establishment Bill and the Joint Revenue Board Establishment Bill.
Leader of the Senate, Senator Opeyemi Bamidele, read the lead debate when the close session ended.
According to him, the set of four legislative proposals will increase Value Added Tax (VAT) distributable to the subnational governments to 55% while reducing the federal government's share to 10%.
Bamidele said the new legislative regimes also proposed zero VAT on exports and essential consumptions by the masses and grant of input VAT credit on assets and services in addition to goods consumed by businesses to lower the cost of production
He reeled out far-reaching proposals contained in the Tax Reform Bills, which, according to him, aims at simplifying the tax landscape, reducing the burden on small business and streamlining how taxes are collected.
When the floor was yielded to Senators who wanted to contribute, the Chairman, Senate Committee on Finance, Senator Sani Musa, urged his colleagues to give the bills chance to pass through normal legislative process while those who have dissenting voices should do so constructively.
Similarly, the Senator representing Bayelsa West, Seriake Dickson, commended the executive for coming up with the landmark tax reform bills.
He said the fiscal legislation would entrench fiscal federalism in Nigeria if passed into law.
The former Bayelsa state governor noted that Nigerians were paying tax and the government at various levels have been using it to execute developmental projects since the colonial era.
He said the situation changed when oil was discovered and the sub regional government started relying on the federal government for federal allocation.
He noted that some stakeholders objected to the bill because there was no proper consultation.
According to Dickson, "The position of the Nigerian Governors Forum is legitimate. The executive should carry out more enlightenment on the bills. As a federalist, which I've been all my adult life, I see these bills as a move towards entrenching fiscal federalism in Nigeria, which I fully support.
"I use this opportunity to call on all my colleagues to agree that these bills, all four of them, should be passed for second reading to enable our committee and the experts and the general public engage in accordance with our rules. The tax reform bills when passed to law, will entrench fiscal federalism in Nigeria".
President of the Senate, Senator Godswill Akpabio, who presided over the plenary thereafter invited former Senate Leader, Senator Ali Ndume (Borno South), to make his remarks on the bills.
Rather than contributing to the debate on the general principles of the bills, Ndume said the timing for the bills introduction was wrong and advised that they should be withdrawn for proper consultation in order to get the buy-in of the critical stakeholders who are opposed to it.
He urged the Senate to consider the sensitivities of the moment, by adopting a more strategic approach to avoid backlash.
Ndume then advocated that the bills be temporarily withdrawn to allow for more consultation with state governors, the National Economic Council (NEC), and traditional rulers.
He emphasised that the reforms would be more effective if they had the buy-in of the critical stakeholders, suggesting that swift passage could occur after such consultations.
Ndume said, "Let it be on record that my problem with the bills is the timing. Number two is the issue of derivation. The issue of derivation made the reform contagious, contaminated, and contradictory in some cases. This is because the constitution has to be amended in order for some of these proposals to be effective. I'm glad we are doing a constitutional review. So even if it means reviewing the constitution.
"I agree that we should not throw away the baby with the bathwater. I would have preferred we remove the baby and throw away the water first. And that is to go with what the governors and NEC proposed. The bills should be withdrawn and re presented to the National Assembly again after getting the buy-in of the governors and NEC and even our traditional rulers.
"Let's be honest with ourselves. If we sit down here, work on these bills, assuming as it is now, there may be a backlash. This is because the governors have not come out publicly to change their position, the traditional rulers have not sat down publicly to change their position. NEC have not sat down to change their position.
"As for me. I looked at the bill which contains so many good things, but these two things, derivation and VAT. Even though you say it will be addressed at the public session, it's not something that many of us will agree to.
"You started by saying, we are going to negotiate, which is good, and it's coming from you. Why don't we negotiate first before we come out to take a position?
"The people through the governors and the traditional rulers say the bills should be withdrawn, make some necessary amendments and then bring it back and we can pass it in 24 hours. That is my position."
Ndume's position was instantly countered by the Senate Chief Whip, Senator Tahir Monguno, who disagreed with the position of Ndume.
He said the views of the stakeholders who are opposed to the bills could be taken at the public hearing after the legislation had passed second reading.
Monguno, who took over from Ndume as both the Chief Whip and Vice Chairman, Senate Committee on Appropriation, following his removal, said in the course of public hearing, the governors and traditional rulers are free to ventilate their opinions.
He said Ndume's position was strange to legislative process but could only pass for a mere academic exercise.
Monguno, former Chairman of Senate Committee on Judiciary, Human Rights and Legal Matters, expressed serious concerns that Ndume, who was minority leader in the House of Reps, a leader in the Senate, and immediate Chief Whip of the Senate with all the cognate experiences of lawmaking, came up with such arguments.
His words, "I disagree with you (Ndume), that this bill should be withdrawn first and consultation should be held with the Nigerian Governors Forum and traditional rulers.
"We have a procedure which is clearly and umambiguously stated in our rulebook for the process of lawmaking. The Constitution, in a very clear and unambiguous manner, gave us the power to regulate our proceedings.
"Section 60 of the 1999 Constitution as amended, gave us power to make these rules for ourselves in order to guide our proceedings. The process of lawmaking is very clear and unambiguous as per this book. That after the second reading of a bill, it will be transmitted to the Committee for Public Hearing.
"In the course of the public hearing, Nigerians from all walks of life, all groups, will come and aggregate, including the governors and traditional rulers. They are free to come and ventilate their opinion."
"With due respect, what Senator Ndume has suggested is alien to the process of legislation exercise and therefore is fairly academic and should not be considered.
President of the Senate, Godswill Akpabio, then put the question as to whether the senators would want the bills passed or not and the lawmakers overwhelmingly voted in support.
Akpabio thereafter mandated the committee on Finance, to organise Public hearing on the bill for inputs from those against the bills like the Governors's forum, National Economic Council (NEC), Northern Elders' Forum (NEF), etc and report back within six weeks.
Ndume's antagonist tendencies towards the bills had however started a day earlier when his position and that of the Senator representing Bauchi Central, Abdul Ningi, threw the Senate into a rowdy session.
The development happened following the decision of the Red Chamber's leadership to admit the Federal Government's team driving the tax reform bills, to address the Senators.
Trouble started when the Leader of the Senate, Senator Opeyemi Bamidele announced that there were visitors who would be coming to the chamber to brief the Senate on the proposed tax reform bills.
Bamidele at the session, presided over by Deputy Senate President, Senator Jibrin Barau, invoked Order 12 (1) to suspend the Senate Rules, seeking permission for their guests to enter the chamber and address them.
The visitors included the Chairman of the Federal Inland Revenue Service (FIRS), Mr. Zacch Adedeji; Director General of the Budget Office, Tanimu Yakubu, and the Chairman, Presidential Committee on Fiscal Policy and Tax Reforms, Mr. Taiwo Oyedele.
Ningi, the Bauchi Central Senator, raised a point of order, drawing the attention of the presiding officer to an error in the decision to admit the guests into the chamber because they were not captured among the categories of people recognized in the rule book.
Ningi cited Order 12 of the Senate rule book to read out the categories of people who should be admitted into the chamber, and argued that the listed visitors were not in such categories.
However, Bamidele clarified that he actually sought the suspension of the order 12 to admit the people.
Barau noted Ningi's point of order but said the essence of inviting the visitors was to educate Nigerians through the Senate about the controversial tax reform bills to avoid confusion among the citizenry.
Bamidele's motion to welcome the guests was seconded by the Minority Leader, Senator Abba Moro, and the Sergeant-at-arms led them into the chamber.
Just as the guests were taking their seats, Ndume objected strongly, to the decision through a point of order.
He noted that the Tax Reform Bill was not on the Order Paper and that the Senate rules prohibit discussions on matters not listed on the order paper without proper procedural adjustments.
"This is a very important matter, and we must follow the rules," Ndume stated, warning that circumventing protocol undermines legislative integrity.
He urged the Senate to ensure proper representation of Nigerians' interests, stressing the bill's significance in the face of public concerns.
Ndume insisted that the matter was too important to be manipulated and the Senate should not in any way play around the Tax Reform Bills as Nigerians have spoken.
His words, "This is a very important matter. We should not in any way try to use the position of the Senate to treat it anyhow because the Order Paper is clear. I have no problem about having them come to explain whatsoever but we must follow known procedures. That is if today that has to be taken, then there must a supplementary Order Paper that will reflect this. It is not a matter that you will just come and tell us after we are doing business of the day that some visitors are coming to address us".
Sign up for free AllAfrica Newsletters
Get the latest in African news delivered straight to your inbox
Ndume, who was intermittently interrupted by Barau, who accused him of hanging on to rhetoric to marshal his point, said, "Mr President, you can have your way, but I will have my say. You can use your gavel and I will use my voice."
The ranking Senator further said, "The Tax Reform Bill is very sensitive, our people have been dominated by this matter. When you say, it is a matter of urgent national importance, yes, but even those matters normally referred to another legislative day if there are so inconvenient.
"Please I beg you in the name of God this matter if very important to not only us, but Nigerians that we represent and we swear by Bible and Holy Quran that we will represent the interest of the people. Nigerians have spoken, the Governors, the National Economic Council".
Despite Ndume's objections, Barau defended the decision, and insisted that the Senate acted within the rules, and dismissed the argument as an unnecessary rhetoric.
His remarks ignited tensions, causing the session to become chaotic.
Ndume then came up with another point of order claiming that Barau used unparliamentary words against him which should be withdrawn.
Barau eventually restored order by saying his use of the word, 'rhetoric' was not meant to ridicule Ndume but referring to his arguments which had been taking care with the suspension of the rule book with a motion.
He insisted that whatever the Senate was doing was within its rules, adding that the "Chamber has no time for rhetoric."
Barau said, "You have made your point now we are not here for rhetoric. We are here for facts " At this point the Chamber went rowdy while the Deputy Senate President tried to restore order.
Ndume was eventually ruled out of order and the visitors were allowed into the hallowed Chamber to speak on the proposed Tax Reform Bills.
The team told the Senators that tax reform bills are four different legislations that seek to bring everything about taxation and administration of tax in Nigeria under four different pieces of legislation.
They explained that the bills contain all major taxes imposed on individuals and companies and that it is just like a compendium of taxes charged in Nigeria.
Keen watchers of developments over the landmark tax reform bills are however of the opinion that the trouble which was managed at the Senate plenary might get out of hand at the public hearing with the current opposition to the bills, especially on the issue of VAT derivation by some groups and opinion leaders from the northern part of the country.
