Inadequate Public Enlightenment Obstructing Passage Of Tax Reform Bills (1)

Public enlightenment typically precedes the introduction of new policies to fa­cilitate understanding, acceptance, and implementation. This is why companies seeking to go public on the Nigerian Stock Ex­change (NSE) prepare an information memo­randum to educate stakeholders and the general public. Unfortunately, the current government has repeatedly overlooked this fundamental princi­ple, as seen in several instances.

These include the abrupt removal of the petrol subsidy on May 29, 2023, the unification of the dual foreign exchange regime, inadequate awareness of the Nigerian Education Loan Fund (NELFUND), and the ongoing debate over tax reform bills cur­rently before the Senate. This lack of proactive communication has fueled widespread public discontent. It seems no lessons were learned from the strong resistance Nigerians mounted following the subsidy removal and the naira’s devaluation.



The tax reform initiative is now being pursued without adequate public sensitization, result­ing in growing resentment and criticism of the administration. What makes this backlash even more surpris­ing is that these policies, including the reform initiatives, are intended to serve the long-term interests of the masses. Historically, inadequate communication about taxation has had dire consequences, such as the infamous Aba Women’s Riots of 1929, sparked by opposition to taxes imposed by the colonial government.

To prevent a repeat of such events, today’s leaders must address misin­formation and disinformation that could derail the noble intentions behind the tax reform bills under consideration. A comparison between the Aba Women’s Riots and later instances of resistance to gov­ernment policies highlight the importance of effective communication. For example, during General Ibrahim Babangida’s administration in 1984/85, the Structural Adjustment Program (SAP) gained public acceptance largely because it was preceded by a nationwide debate.

This debate informed citizens about SAP as a viable alternative to an IMF loan, earning their buy-in. This demonstrates the power of communica­tion as a tool for bridging the gap between leader­ship and followership. Nigerians’ acceptance of SAP was largely credited to the exceptional work of the National Orientation Agency (NOA) un­der the leadership of Professor Jerry Gana.

His efforts to align Nigerians with the government’s agenda stand as a testament to the critical role of public enlightenment in ensuring policy success. The recent debates in both the House of Rep­resentatives and the Senate over the proposed tax reform bills highlight a troubling lack of align­ment among lawmakers. The discord within the legislature raises questions about how much the public understands these bills, given that even lawmakers appear divided.

A striking example is the apparent contra­diction among principal officers of the Senate. Deputy Senate President Jubril Barau claimed the debate on the tax reform bills had been suspended, while Senate President Godswill Akpabio and Senate Leader Opeyemi Bamidele indicated otherwise. This public display of in­consistency undermines the credibility of the Senate, exposing it to ridicule and unnecessary criticism—damage that could easily have been avoided if the leadership had presented a unified stance.

Ideally, internal deliberations should have harmonized their positions before addressing the public. For instance, Barau’s statement could have been clarified as a directive for the Senate committee to temporarily pause its work while the 10-member ad hoc committee consulted with the executive branch, where the bills originated. Instead, the lack of cohesion made the debate resemble a regional contest between the South and the North, creating unnecessary tension.

This situation reflects a broader issue: pol­iticians often dedicate immense effort to cam­paigning and engaging with the public before elections, only to neglect meaningful commu­nication after securing office. Andrew Cuomo, a former governor of New York, captured this irony with the phrase, “Campaign in poetry, gov­ern in prose.” While campaigns are filled with as­pirational rhetoric designed to captivate voters, governance requires clear, detailed communica­tion about policy implementation—something Nigerian politicians frequently fail to deliver.

The contrast between poetic campaigning and prosaic governing becomes clear when ex­amining the nature of poetry versus prose. Poet­ry is characterized by its evocative, imaginative qualities, while prose relies on straightforward, factual language. This shift from inspiration to practicality often leaves politicians reluctant to engage deeply with constituents during their tenure, perhaps to avoid accountability for cam­paign promises.

This lack of effective communication is one of the core challenges of governance in Nigeria. Chinua Achebe famously attributed Nigeria’s problems to leadership deficiencies in his sem­inal work, ‘The Trouble With Nigeria’, and the ongoing debate on tax reforms is yet another example of this shortfall. The tax reform debate has been unnecessar­ily framed as a regional battle for dominance, overshadowing the actual merits of the proposed reforms.

Instead of focusing on the technical and legal aspects, my interest lies in reframing the narrative to emphasize the importance of effective communication in fostering unity and shared prosperity. As a democracy advocate and development strategist, I believe a holistic ap­proach is critical for addressing national issues. Effective communication is the cornerstone of any successful partnership, whether in gov­ernance, business, or even marriage.

It serves as the lubricant that keeps relationships func­tioning smoothly—a quality Nigeria desper­ately needs in its multi-ethnic, multi-regional context. As the legislative process continues, it is cru­cial to evaluate the tax reform bills through the lens of national unity and collective progress, rather than as a divisive contest between the North and the South. By prioritizing effective communication and collaboration, lawmakers can steer the debate toward outcomes that ben­efit all Nigerians, reinforcing the vision of one Nigeria.

It is encouraging to note that, according to tax experts, the proposed reforms could bring signif­icant relief to ordinary Nigerians, particularly those disproportionately affected by Value Add­ed Tax (VAT). As experts point out, VAT—com­monly referred to as a consumption tax— im­pacts the poor most heavily because they spend a larger portion of their income on basic needs like food. Under the new tax regime, small and medium-scale enterprises with capitalization below N50 million and individuals earning less than N80,000 monthly are exempt.

Meanwhile, large corporations and high-income earners will shoulder the burden through Company Income Tax (CIT) and Personal Income Tax (PIT). Ironically, the very groups that stand to ben­efit the most from these reforms are largely un­aware of the relief measures, leading them to resist rather than embrace the changes. This lack of awareness underscores the failure of effective advocacy and communication around the bills, leaving the nation divided over whether to accept or reject the reforms currently before the legislature.

To address the impasse, a political solution is being pursued through the establishment of a Senate ad hoc committee led by Minority Leader, Abba Moro. This committee is tasked with en­gaging the Attorney General of the Federation, Lateef Fagbemi, to resolve contentious issues. This collaborative approach aims to clarify “grey areas” and build consensus, similar to how the “Doctrine of Necessity” was invoked in 2010 to stabilize governance after the sudden death of President Umaru Yar’Adua.

Unfortunately, before this attempt at resolu­tion, the debate over the reforms had taken on a divisive tone, with some lawmakers framing it as a North versus South issue. A key point of contention lies in the proposed VAT sharing for­mula. For instance, data from the Nigerian Bu­reau of Statistics (NBS) shows that while Lagos generates approximately 55% of VAT, the entire Northern region contributes only about 25%.

This disparity highlights the untapped economic potential of Northern states. For example, Nasarawa State, located near Abuja, is rich in solid minerals like lithium and tin, as well as agricultural produce such as citrus fruits. If properly harnessed, these resources could drive industrialization and significantly boost VAT contributions.

Lithium and tin, for instance, could be processed into batteries and other high-demand products for electric vehicles and advanced technologies. Similarly, agricul­tural processing facilities for citrus fruits could mirror Florida’s thriving juice industry in the United States. Zamfara State provides another example, with its substantial gold deposits attracting il­licit mining operations.

With the proposed VAT reforms, states will retain 60% of the VAT gener­ated within their borders, incentivizing govern­ments to formalize and secure these industries. By establishing local processing plants, states can not only create jobs but also earn additional CIT and PIT revenues, alongside VAT. Despite these opportunities, many state governments have been reluctant to attract investors.

States like Lagos, which hosts a significant share of Nigeria’s industrial and service sectors, have reaped substantial benefits from being business-friendly. In con­trast, most states impose burdensome taxes on startups, stifling economic growth. A few exceptions, such as the former Edo Governor Godwin Obaseki, current Nasarawa Governor Abdullahi Sule, and Enugu Governor Peter Mbah, have taken proactive steps to foster business-friendly environments.

If the tax reform bills are passed into law, states will likely intensify efforts to attract both local and foreign investors. For example, gov­ernors could elevate the role of the Corporate Affairs Commission (CAC) in their states to en­sure businesses register locally and establish headquarters within their jurisdictions. By do­ing so, they can maximize their VAT derivation and other tax revenues.

.