Nigerian Senate Suspends Tax Reform Bills Amid Northern Opposition, Constitutes Ad-Hoc Committee for Resolution

The Nigerian Senate has halted legislative action on the contentious tax reform bills, citing the need for extensive stakeholder engagement to resolve disputes. The decision comes amidst strong opposition from northern politicians, who argue that the proposed reforms could disproportionately harm their region.

Deputy Senate President Barau Jibrin, who presided over Wednesday’s plenary session, announced the formation of an ad-hoc committee to address the contentious aspects of the bills. The committee will collaborate with the federal government and other stakeholders, including the Attorney General of the Federation, to ensure all interests are adequately considered.

The Contentiousness of the Tax Reform Bills

The tax reform bills, part of a broader fiscal strategy to increase government revenue, have faced significant pushback, particularly from northern lawmakers. Many politicians from the North argue that the reforms could deepen economic inequality across Nigeria’s regions, with the northern part of the country—already grappling with poverty and underdevelopment—being the hardest hit.

One of the most vocal opponents, Senator Ali Ndume, representing Borno North Central Senatorial District, has repeatedly expressed concern over the potential consequences of the bills. Speaking at an earlier Senate session, Ndume warned that the reforms, if implemented, could exacerbate economic challenges in the north. He asked for the bill to be withdrawn pending consultations.

“This is not the first time such a thing [withdrawal of bill] has been done; some good examples include the water resource bill when our friends from the South raised concerns and it was withdrawn. We had the Petroleum Industry Bill (PIB), which was withdrawn on several occasions in the House of Representatives and the Senate before it was finally passed after more than ten years.

“As I said before and I will repeat it, why the hurry? This is something that should be done after wide consultation because it requires the buy-in of all stakeholders,” he said.

Ndume’s sentiment has been echoed by other northern politicians and interest groups, who argue that the reforms do not adequately account for the unique economic realities of the region, which relies heavily on agriculture and informal trade rather than industrial or high-value economic activities.

Senate’s Decision to Suspend Action

Deputy Senate President Jibrin emphasized the importance of addressing these concerns through dialogue. He announced that the Senate would pause all legislative processes related to the bills, including public hearings until a consensus is reached.

“It has been agreed by the executive and also by us that there should be a forum where we will sit with the Attorney General of the Federation so that we can look at all the areas of disagreement and resolve them in the interest of this nation,” Jibrin said.

He further explained that an ad-hoc committee had been constituted to spearhead the resolution process, emphasizing inclusivity and regional representation in its composition.

The committee, chaired by Senate Minority Leader Abba Morro, includes prominent lawmakers from Nigeria’s six geopolitical zones and key Senate leaders:

• Mohamed Tahiri Mongono (North-East)
• Adamu Aleiro (North-West)
• Oji Uzor Kalu (South-East)
• Deriake Dickson (South-South)
• Titus Zam (North-Central)
• Abdullahi Yahaya, Chairman of the Senate Committee on National Planning
• Adeola Solomon, Chairman of the Senate Committee on Appropriations
• Sani Musa, Chairman of the Senate Committee on Finance
• Tokunbo Abiru, Chairman of the Senate Committee on Banking

This diverse composition reflects the Senate’s intention to address regional disparities and ensure balanced representation in the discussions.

However, the pushback underscores a deeper challenge in Nigeria’s fiscal policy-making: the difficulty of implementing nationwide reforms in a country with stark regional disparities.

The ad-hoc committee is expected to convene its first stakeholder forum imminently, with participation from the Attorney General of the Federation, state governors, industry leaders, and civil society organizations. The outcome of these discussions will likely influence the future of the tax reform bills and set a precedent for addressing regional concerns in national policymaking.

The tax reforms are part of broader efforts by the federal government to address fiscal imbalances and reduce reliance on oil revenue. However, as seen in this case, such initiatives often encounter resistance due to the uneven economic development across Nigeria’s regions.