Labor and Religious Groups Strongly Oppose Tax Hike
The Trade Union Congress of Nigeria (TUC) and the Supreme Council for Shari’ah in Nigeria (SCSN) have rejected the proposed VAT increase from 7.5% to 15%. This plan, included in the Tax Reform Bills, has raised serious concerns among economic stakeholders.
TUC Warns of Financial Strain on Nigerians
Speaking at a public hearing in the House of Representatives, TUC President Festus Osifo, represented by Secretary-General Nuhu Toro, stressed the need to keep VAT at 7.5%. He argued that an increase would worsen the financial struggles of many Nigerians.
“This proposal comes at a difficult time. Inflation is high, and unemployment is rising. Increasing VAT now will push more households and businesses into hardship,” Osifo stated.
Call for Higher Tax Exemption Threshold
To ease the burden, the TUC suggested raising the tax exemption threshold. Instead of ₦800,000 per year, they proposed ₦2.5 million. This, they argued, would help Nigerians with lower incomes manage daily expenses.
Objection to Cuts in Education and Infrastructure Funding
The TUC also opposed plans to defund key institutions. They insisted that the Tertiary Education Trust Fund (TETFUND) and the National Agency for Science and Engineering Infrastructure (NASENI) should continue receiving financial support. These agencies, Osifo noted, contribute significantly to national development.
Concerns Over Oil and Gas Revenue Collection
Another major concern was the proposed Nigerian Revenue Service Bill. This bill seeks to transfer control of royalties and revenues in the oil and gas sector to a new agency. The TUC strongly opposed this move. They aligned with the Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN), which had already rejected the proposal.
Sharia Council Recommends VAT Reduction
Similarly, the Supreme Council for Shari’ah in Nigeria backed the TUC’s position. Representative Ahmed Bello urged the government to reconsider. He suggested either maintaining VAT at 7.5% or reducing it to 5%. Given the country’s economic challenges, he argued, a tax hike would not be the right decision.
