Nigerians on social media have begun to clapback on Taiwo Oyedele, the chairman of the Presidential Tax Reforms Committee, as a 2019 tweet on X where he kicked against Value Added Tax (VAT) increase resurfaced online.
Oyedele, who is placed with the task of simplifying Nigeria’s tax administration to ensure seamlessness and ensure inclusive growth and shared prosperity, said in the tweet that raising VAT then was ill-timed and inconsistent with the country’s economic situation.
The tax expert in 2019 under former President Muhammadu Buhari criticised the then-Federal Inland Revenue Service Chairman, Babatunde Fowler’s plan to raise VAT from 5 percent to between 7.25 percent and 8.75 percent.
These resurfaced tweets have sparked mixed reactions, with critics and supporters offering divergent views.
Read also: We don’t intend to scrap NASENI, TETFUND – says Oyedele
“Contemplating an increase in VAT rate now is bad timing and inconsistent with current economic reality. VAT rate increase will lead to higher inflation, interest rate hike, more unemployment and generally make people poorer,” Oyedele said in the 2019 tweet.
He argued that the government’s dual strategy of expanding the VAT net while increasing rates was counterproductive, warning that it could derail efforts to improve compliance and widen the tax base.
According to Oyedele, raising VAT without implementing safeguards such as a registration threshold and zero-rating for basic goods would disproportionately burden small businesses and low-income earners, contravening the 2017 National Tax Policy.
“Nigeria can make twice as much from VAT at the current rate by reforming the law, expanding the net, and ensuring robust administration rather than by increasing the rate,” he said.
Read also: Analysts applaud proposed tax reforms, call for PIT review
Meanwhile, Oyedele’s committee, put together by President Bola Tinubu has recommended that VAT be increased from 7.5 percent to 15 percent by 2030 under the proposed Tax Reform Bills awaiting legislative action.
This recommendation has drawn criticism, with many accusing him of contradicting his earlier stance.
Onyedika Ngonadi on X said “Taiwo Oyedele was against Emefiele and the Buhari government raising VAT to 7.5%, arguing it would cause inflation”.
“Today, he is advocating for an increase in VAT to 10%. These folks had all the solutions when they were not in government”.
However, another user, @allibaloo backed the tax bills, stating that “people trying to use Taiwo Oyedele’s 2019 tweet to hound him are quite funny. If you’re in Lagos, where a 5% consumption tax applies, you’d realize this: increasing VAT means you’d still pay the consumption tax on top of it.”
“Now, his current proposal is actually saving you money because his proposal eliminates the consumption tax altogether.”
The tax chief in a town hall meeting on Monday clarified that the tax reform bills are aimed to fix the economy, lower widespread poverty by exempting low-income earners completely from tax.
In a separate tweet on Tuesday, Oyedele reiterated that the tax reforms will ensure a prosperous economy by promoting a viable business climate that will attract capital.
“These tax reforms aim to alleviate the rising cost of living, foster economic equity, and create a business-friendly environment to attract local and foreign investments,” the tax chief said.
Join BusinessDay whatsapp Channel, to stay up to date
Open In Whatsapp
