Tax Reform Stalemate: Tinubu Intensifies Efforts to Win Northern Support

President Bola Tinubu has intensified efforts to gain northern support for his tax reform bills, which have faced significant opposition from governors and political leaders in the region. According to sources in the Presidency, Tinubu has been reaching out to northern elites and political figures, both individually and collectively, to address concerns and clear the way for the bills’ passage.

The tax reform bills, introduced to the National Assembly in October 2024, include the Nigeria Tax Bill 2024, the Nigeria Tax Administration Bill, the Nigeria Revenue Service (Establishment) Bill, and the Joint Revenue Board (Establishment) Bill. These bills propose significant changes to the country’s tax distribution framework, including a shift to a derivation-based model for Value Added Tax (VAT). This proposed system, which allocates VAT based on where goods and services are consumed and where companies are headquartered, has been met with sharp criticism from northern governors who believe it will disadvantage their region.

The Northern Governors Forum has voiced unified opposition, stating that the reforms would undermine the region’s economic stability. In a communiqué issued in late October, the forum called for the bills to be withdrawn for further consultation. Bauchi State Governor Bala Mohammed described the reforms as “anti-northern” and warned of potential political repercussions if the policies were pursued without adjustments.

President Tinubu, however, remains resolute. In a December media chat, he emphasized the importance of the reforms, framing them as essential for broadening Nigeria’s tax base and addressing economic challenges. “This tax reform is pro-poor; the vulnerable are not to pay taxes,” Tinubu explained. “We cannot retool this economy with the old broken tools. The hallmark of a good leader is the ability to do what you have to do at the time it has to be done.”

Despite Tinubu’s assurances, northern governors, including Gombe’s Muhammad Yahaya and Borno’s Babagana Zulum, maintain their opposition, arguing that the reforms would disproportionately benefit southern states like Lagos while leaving northern states at a disadvantage. Representatives from Kano, Nasarawa, and other northern states echoed similar concerns, asserting that the reforms could exacerbate existing economic disparities.

Prominent voices outside the government, including analysts and opposition party leaders, have called for the bills to be suspended for broader consultation. Critics argue that rushing the reforms risks alienating key stakeholders and failing to address regional concerns adequately. Jide Ojo, a current affairs analyst, urged caution, stating, “The North has legitimate reasons to be concerned about these tax bills. They should be withdrawn for more consultation.”

Southern lawmakers, however, have largely dismissed calls to withdraw the bills, suggesting that concerns can be addressed through public hearings and legislative amendments. Some argued that delays would undermine critical reforms needed to modernize Nigeria’s tax system and improve revenue generation.

As tensions persist, Tinubu has stood firm, downplaying the criticism from northern governors during a recent visit to Enugu State. “I inherited some of these critical problems, and I’m going to do it,” he stated, emphasizing his commitment to implementing necessary reforms. “People will fight, grumble, abuse me, but I asked for the job. I believe in myself, and I’m working with a very good team to build this nation.”