In a decisive move toward overhauling Nigeria’s taxation framework, the House of Representatives has passed for second reading a Bill seeking to amend the 1999 Constitution (as amended) to clearly define the taxation powers of the Federal, State, and Local Governments. The proposed legislation is aimed at eliminating multiple taxation, curbing unlawful outsourcing of tax collection, and fostering transparency in the nation’s fiscal system.
The Bill, titled “Bill for an Act to alter the Constitution of the Federal Republic of Nigeria, 1999 (as amended), to Clarify the Taxation Powers of the Federal, State, and Local Governments; to Define the Scope of Taxes and Levies Collectible by Each Tier of Government; to Prevent Multiple Taxation and Unlawful Outsourcing of Revenue Collection and for Related Matters,” was sponsored by the Deputy Speaker of the House, Hon. Benjamin Kalu, alongside six other lawmakers.
Leading the debate on the general principles of the Bill, co-sponsor Hon. Joshua Audu Gana described the proposed amendment as a “transformative step” toward establishing a coherent and transparent taxation system in the country. According to him, the current fiscal arrangement has become “congested and conflicting,” resulting in confusion, inefficiency, and frequent disputes among the tiers of government.
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“This Bill aims to bring order where confusion reigns, to create clarity where overlaps have persisted, and to ensure that every naira raised, shared, or spent by government is traceable, lawful, and transparent,” Gana stated.
He lamented that the practice of multiple taxation—where different levels of government impose similar taxes or levies on the same individuals and businesses—has over the years discouraged investment and hindered economic growth. He further noted that many government agencies have resorted to contracting private consultants or agents for tax collection, a development that has opened avenues for corruption, harassment, and revenue leakages.
“At the heart of this Bill,” Gana continued, “is a simple but transformative goal—to align the revenue powers of the Federation, States, and Local Governments in a way that promotes efficiency, discourages duplication, and restores trust in the fiscal system.”
The lawmaker cited the long-standing disputes over Value Added Tax (VAT), Stamp Duties, and Personal Income Tax between the Federal Government and some states as clear evidence of the need for constitutional clarity. He argued that the amendment would prevent such jurisdictional clashes, thereby strengthening fiscal harmony across the federation.
Observers within the National Assembly and economic policy circles have lauded the Bill as a critical step toward addressing Nigeria’s deeply rooted taxation challenges. Fiscal experts argue that once passed, it would streamline revenue collection, enhance public accountability, and promote investor confidence by reducing the burden of multiple taxation on businesses.
The Bill, after scaling second reading, was referred to the House Committee on Constitution Review for further legislative action. If successfully passed and assented to by the President, it could mark a turning point in Nigeria’s fiscal governance—ushering in a more equitable, efficient, and transparent taxation system that aligns with global best practices and supports sustainable national development.
