Reps want VAT on the federal menu, permanently. That was the headline coming out of Wednesday’s plenary as a bill to slot Value Added Tax (VAT) into the Constitution’s exclusive legislative list sailed through second reading. The proposal, co-sponsored by Deputy Speaker Benjamin Kalu and six colleagues, is pitching itself as the antidote to Nigeria’s tangled web of overlapping tax mandates. For a clearer understanding of the principles underpinning these reforms, readers may explore Introduction To Nigerian Tax Laws.
“This bill seeks to bring order where confusion reigns,” lead debater Hon. Joshua Gana told lawmakers, insisting every naira must be “traceable, lawful, and transparent,” Premium Times via AllAfrica reports.
If passed, VAT administration would rest squarely with the centre, potentially ending years of turf wars between Abuja and the states. The move comes alongside a companion bill to clarify which tier may collect which levy, already approved for second reading in the House, according to Voice of Nigeria. Together, the duo forms the most ambitious constitutional tax rewrite since 1999, marking a key milestone in Nigeria's comprehensive tax reform legislation.
The reaction was swift. Supporters argue the changes could streamline compliance and lift Nigeria’s tax-to-GDP ratio above its current 10 percent. Critics, however, warn that yanking VAT away from states could upend revenue planning and rekindle federalism debates. Either way, the message from Abuja is clear: tax harmonisation is no longer a talking point, it’s a legislative priority.
Around the Tax World
• Freelancers, meet the tax net. Nigeria’s 2025 reform pulls remote tech workers into worldwide income taxation if they clock 183+ days onshore ( BusinessDay ).
• CITN says small businesses can breathe. Firms with turnover under ₦100 m will be exempt from company tax, CITN president Innocent Ohagwa assured attendees in Ilorin ( Business Post ).
• Revenue service 2.0. The Federal Government kicked off a digital makeover that will morph FIRS into a National Revenue Service and absorb Customs’ collection duties, aiming for an 18 percent tax-to-GDP within three years ( The Guardian ).
• Crash course, anyone? GBC Professional Services is hosting a two-day boot camp in December to help CFOs decode the new laws before they take effect on 1 January 2026 ( Newsmakers NG ).
Tax Stat of the Day
17.5 million, The World Bank’s estimate of online gig workers across Nigeria, Kenya, and South Africa, many of whom will now file Nigerian tax returns (BusinessDay).
Looking Ahead
All eyes now turn to the House Committee hearings; if momentum holds, the VAT and tax-powers bills could reach the Senate before year-end, just in time for the January reform rollout.