On May 7, 2025, the Nigerian Senate took decisive action on the nation’s fiscal policy by rejecting a proposed increase in the Value Added Tax (VAT) from 7.5% to 10%.
This decision was part of a broader legislative session focused on tax reforms aimed at enhancing revenue generation and distribution.
During the session, the Senate passed two significant tax reform bills: the Nigeria Revenue Service (Establishment) Bill and the Joint Revenue Board (Establishment) Bill.
These bills are designed to streamline tax collection processes and improve inter-agency coordination, thereby boosting efficiency in revenue administration.
The bills were thoroughly examined clause by clause in the Committee of the Whole, following the presentation of a report by an ad hoc committee led by Senator Sani Musa of Niger East.
Senate President Godswill Akpabio emphasised the importance of these reforms, stating that they would add substantial value to governance and transform tax collection and distribution in Nigeria.
Akpabio also announced that the remaining two tax reform bills—the Nigeria Tax Administration Bill and the Nigeria Tax Bill—are scheduled for consideration and passage on Thursday.
He expressed the Senate’s commitment to concluding these bills promptly, even if it requires extended sitting hours.
The rejection of the VAT increase proposal reflects the Senate’s sensitivity to the economic challenges faced by Nigerians.
By maintaining the current VAT rate, the Senate aims to avoid additional financial burdens on citizens while pursuing comprehensive tax reforms to enhance revenue generation and fiscal responsibility.
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cc: Daily Post Ng
