Daniel Bwala is the Special Adviser to President Bola Tinubu on Policy Communication. In this interview, he speaks on the controversies trailing the Tax Reform Bills before the National Assembly and the North’s opposition to the bills, among other issues, ANAYO EZUGWU writes
A pro-Northern coalition group was at the National Assembly to drum support for the passage of that controversial and contentious Tax Reform Bills. Is there a general position of the North on the bills?
I am from the North, and I am saddened by the notion generated in the media that it is a North versus the South thing, and not from the media in the sense of media people, but people creating the narrative that the Tax Reform Bills are built or designed to afflict the North.
That is far from the truth. The problem we always have, quite frankly, is that sometimes we have failed to look at the difference between politics and policy. Let me just go straight to the arguments.
The argument of a few people, I have to use the word very advisedly because I’ve seen lots of northerners, who support the bills, lots of them from different parts of the North, North-East, North Central and NorthWest. But for those who are afraid of the bills, what they have pushed as the major argument is that the bills, if passed to law, will cause hardship to the poor people in the North.
Now, if I have to take them on that argument, then my case would be that the contrary is the reason. I mean, the very opposite is the point of the bills because if you say that the bills are going to impoverish the North or going to afflict poor people, it is this proposed bills that are addressing the problem that the poor people encounter.
For example, we have existing tax laws in Nigeria to the effect of, let’s say, things that affect the poor people in the North. If you go to eat, if you go to a restaurant now, you eat, you pay VAT. If you enter public transport, you pay VAT.
Even on personal income tax, even for small and medium enterprise business people. So, all of the issues that affect the poor and the very poor, these tax laws addressed them, not against the poor, but in favour of the poor.
The reason I’m saying that is because we want to take arguments at their face value, on a case-by-case basis. So, let us, except if they agree with me that the argument should no longer be about protecting the poor because it is a conclusive fact that this bills support the poor and does not oppress the poor.
If you talk about the cyclical effect of economic dynamics, it’s everywhere in the world. How many poor people buy toilet paper if we have to push the argument further? What is very essential to them at the moment is hunger and food. And the president has been clear about that.
The policy of the government has been clear about that. The governance reform across the world is to deal with hunger and then climate change. The president has a vision for the poor. As a government, he has policies for the poor. The tax, which is part of the many reform policies introduced, is also in favour of the poor.
The bills lean in the direction of trying to make life better for the poor, small and medium enterprises and all of that. But in that regard, why do you think opponents have such a big problem with the bills?
Like I said earlier, sometimes we play politics and policy together or we mix politics and policy. Sometimes in a bid to oppose or support policy, we bring politics and because they are very similar, you see that a vast number of people get misled by those who play politics with policy, thereby misleading the general public.
So, I see that if you remember when local government autonomy was introduced, the governors didn’t favour that, even though it is a good governance approach to freedom across democracy.
So, this one is also part of those that’s why you see that it is governors who are opposing that. But what does the law say about the law-making process?
The president has been clear about that. When the National Council of State said that they were asking for a return of the bills, he said let it go through the legislative process. We run a democracy; the law-making power in section 4 of the Constitution lies with the National Assembly. Members of the National Assembly represent their respective states.
But the reason why I’m very emphatic about this issue of poverty is because I come from the North, and the conversation in the North is that this will bring poverty to you, or this one will impoverish you. Let us be clear about that. The tax is in favour of the poor.
But the argument that most people make, in fact, may I even look beyond that. It is not even the issue of North and South. It is just the issue of certain elites who feel that this policy is going to reduce the extent of the revenue they have to make to do one or two things.
But that’s an important point because the problem seems to be that the distribution formula is perceived not to favour the North…
Not really. If you apply the oil revenue share to this tax, that is when you would say it will inflict or afflict the North. You see, this idea of 50-30-20 being switched to 60-20-20 if you look at the dynamics of the distribution, and it is quite there, the data is there, there are cases in which it favours the North proportionately. There are cases in which the North benefits more.
And there are cases where it’s not even the North and the South because this same argument that some of the states in the North are making, that same argument could have been made by some parts of the South-South who would have suffered more than some parts of the North.
You know that what the North is very, very professional about is politics. I see it even more of playing the politics for negotiation. They want to bargain. They want to have a bargaining stand with the President on whatever issue, I don’t know.
But if it is a strict application of this tax to deal with poor people of Nigeria, we make it clear we’re disseminating this information in the languages from the North for people to know.
I even saw fake news circulating that the President recently signed a contract with his French counterpart, Emmanuel Macron for the re-colonization of Northern Nigeria. It is that bad.
So, let the governors know that they are working together with the President. And you know one good thing; to be fair to the tax team, this is one of those teams in recent history and memory of our democratic experience that have done wider consultation more than any other subject.
In the last two weeks, conversations around the tax reform have happened across platforms more than 200 times just to communicate with the people.
And this is open. You can see it. On this side, it favours Lagos. On this side, it favours Kano. On this side, it favours Borno. The application of the tax law in terms of dealing with hunger, and bringing good governance, is the best that has ever happened to Nigeria.
Sometimes in a bid to oppose or support policy, we bring politics and because they are very similar, you see that a vast number of people get misled by those who play politics with policy
What about the collection process of the revenues and those tax revenues?
Some taxes benefit consumption. Some taxes benefit production. Even within the precinct of VAT, the distribution formula is such that some go for equity distribution, those that go for population, and those that are on derivation in the strictest senses and what I told a friend of mine who comes from the North.
I said if you are making the argument that this tax is introduced to afflict the North from the South, who, apart from MTN or one other company, is the highest-paying taxman in Nigeria? He’s a northerner.
Where is his business, it is in Lagos. Why not in Kano or Maiduguri? Because Lagos’ climate provides the climate for him to benefit. Most of these governors have their houses in Lekki, Banana Island, in places where there is value on the asset or value on business.
So, let us discuss business and take away this issue of North versus South. It is one of those things that will not make for the progress of Nigeria. If you have a case to make, come with data, come with statistics. If you argue, make it based on facts that can be verified.
But the idea you go, you carry some of us innocent northerners who believe that this tax is good, and you are saying it afflicts us, I don’t think that is a good argument to make. And I’m calling on all the stakeholders from Northern Nigeria to look at it from the point of view of construction rather than destruction. Look at those areas that affect you. Negotiation is there.
It’s going into a public hearing. There may be, in the course of this conversation, one thing coming here or there, but you cannot throw the baby with the bathwater. And if it touches on the needs of the poor, this tax reform is pro-poor and not anti-poor.
There have been a lot of people from the north who support the bill but do you think this problem can be solved by simply devolving revenue collection to the states?
This tax system is one of the many reforms of this administration. There are many reforms. They call it fiscal reform or whatever. In terms of revenue collection, it’s the easiest thing to do.
We already have a revenue collection institution that by this act coming into law, will be redesigned. When the revenue is collected, it will be distributed according to what the law provides for it. So, there will not be a problem in terms of distribution.
And let me tell you something, some of our governors who decry this issue of tax and say it will afflict the North; you need to go to our respective states and see the taxes that are collected from people who ride Keke to the point where the people are living like slaves. Is that not part of the things that impoverish the North? Why is it that it is this tax that impoverishes the North?
I think that 2027 is not here. Let us not spark the conversation for politicking of 2027. Let us focus on governance. I’m happy that even the governors are open to conversation. They’re open to negotiation. They’re open to deliberation.
The fact that they express their fears is not a problem. The problem is when you now extend it further into misleading, misinforming, or confusing the people from the demographic where you come from because democracy always entrenches and promotes conversation and dialogue.
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