By Cross Udo and Chukwudi Obasi, Abuja
Yesterday, the Nigeria Labour Congress (NLC) attacked President Bola Tinubu’s administration’s tax regime, saying that workers now pay more taxes than they receive from the recently increased minimum wage.
The NLC also recommended to the International Labour Organisation (ILO) that workers be paid a universal wage and conditions of service.
It accused the Nigerian government of not honouring collective bargaining products and added that the country’s social safety net is almost zero.
This came as the Director General of the ILO, Gilbert Houngbo, said lasting peace will only be possible through social justice.
Speaking at the Tripartite Panel on Global Coalition for Social Justice at the UN House in Abuja, the NlC President, Comrade Joe Ajaero, faulted the claims by some federal government representatives that the economic policies have started to show positive signs.
He said, “We are in this hall, and somebody is telling us that the economic policies are showing positive signs. When this government came into power, they removed the subsidy on petroleum products, and millions of naira were expected to come in.
“I want to find out the roads they have used that money to build. In the tax regime today, some of the civil servants here pay more than the increase in the minimum wage. What they collected before the minimum wage is higher than what they’re collecting now because of the tax regime.
“The electricity tariff is unbearable. People are paying for darkness in this country. We are talking about green energy. Not a lot has happened in terms of going green. We are still paying more attention to fossil fuels with all the attendant health hazards and environmental pollution in this country.
“Before, the Nigerian government promised zero-emission by 2030; today, after the Dubai whatever, they are talking of 2060 now, which means there is no conscious effort so far to attain this zero-emission target.”
*Decries zero social safety net
Ajaero commended the ILO Director General for coming up with the dialogue on social justice.
He said, “I want to thank you for this attention to social justice you are talking about. The DG, you have been showing a lot of passion on this, probably because of the background where we come from. We talked about social safety nets.
“It’s almost zero in Nigeria. Nigerians generate their power. Nigerians sink boreholes for their water. There’s no public transportation in Nigeria that is free for people. The hospitals are not there.
“Even the contributory pension policy, some companies have not remitted what they deducted for 60 months. Discussing social safety nets in a country like this without passion is tricky. We have to look at tax justice and even energy justice.
“We have to put them together in the context of the social justice net to arrive at a particular point, but the major problem is greed by the capitalists in our society, pushing the whole world to war.
“And no economy thrives in an era of insecurity and war. If I tell you the demography of insecurity in this country today, you will know why we are having some of the challenges; you will know why we are having problems with productivity.”
He said that the digital economy has many advantages.
He advised that while it was being done, efforts should be made to regulate Artificial Intelligence (AI).
*Suggests universal wage system payment to ILO
He further suggested that there should be a universal wage system.
According to him, “We equally need to look at whether it is possible to have a universal or global wage system, even if we have indices like $50 or $20 and countries of the world key into it, and we know where some of us are standing.
“And it’s important having a universal condition of service, a framework or a benchmark for countries of the world to key in. From there, we now know how to manage ourselves and where we are today in the scheme of things global.
“I have not come here to talk about we did this, we did that. Tripartism is almost coming to nothing. Products of collective bargaining in this country are not honoured. Negotiation- nearly two weeks ago, there was a 50 percent increase in tariff, and we kicked and agreed that within two weeks, we would set up a 10-person committee to negotiate.
“Two weeks almost gone by yesterday, and all the telecom companies have enforced it, even though nearly the top level of government was present at that meeting.
“The sanctity of collective agreement, whether ILO or global organisations, is that the agreement must be respected when the agreement is reached between government and labour.
“The minimum wage that was mentioned here, as at today, most organisations, most corporations have not implemented it almost a year after. However, if it is a tax regime, you can see a situation where you increased the minimum wage this month but have not implemented it. However, some taxes and tariffs have made a mess of that minimum wage if it is eventually implemented. We need to broaden and respect social dialogue issues.”
For his part, the ILO Director General, Gilbert Houngbo, said that lasting peace is only possible through social justice.
He said, “Social dialogue must drive human-centred economic transformation, including technological transformation, ensuring job creation aligned with fair wages, social protection, and sustainable practices.
“As Africa’s largest economy, Nigeria is responsible for leading by example in developing inclusive and sustainable labour policies.”
Earlier in her welcome remarks, the Country Director for Nigeria, Dr Vanessa Phala, said the most important thing about the initiative was its collaborative nature, where many voices are brought together and critical partner’s dialogue on how to move the social justice agenda forward.
*Tax reform bills pass Second Reading in House of Reps, set for public hearing
The House of Representatives passed four consolidated tax reform bills submitted by President Bola Tinubu yesterday for second reading.
The bills include the Nigeria Revenue Service (Establishment) Bill, the Nigeria Tax Bill, the Nigeria Tax Administration Bill, and the Joint Revenue Board (Establishment) Bill.
Originally introduced on October 8, 2024, the bills faced delays due to disagreements, particularly over the Nigeria Tax Administration Bill, with opposition from northern leaders and the Nigerian Governors Forum.
Despite this, Speaker Abbas Tajudeen encouraged lawmakers to engage with their constituents before debating the proposals.
Ahead of yesterday’s debate, the House merged the four bills into a single document.
House Leader Prof Julius Ihonvbere led the discussion and commended President Tinubu’s efforts in tackling multiple taxation, improving revenue collection, and diversifying the economy.
He also acknowledged concerns raised by critics, stating that their input had helped refine the legislation.
“The spirit behind the bills is to overhaul the tax system in this country,” Ihonvbere said.
Minority Leader, Kingsley Chinda echoed similar sentiments, recognizing the bills’ positive intent while pointing out areas that needed revision.
“We all agree that the spirit behind these bills is commendable, but there are issues with some of the provisions. While we oppose certain aspects, we support the overall goal and will ensure necessary corrections are made in the interest of Nigerians,” he stated.
Bamidele Salam emphasised that tax reforms should prioritize the welfare of ordinary Nigerians.
“Any policy or law must first consider the well-being of the majority, especially those struggling to afford necessities,” he argued.
He also praised the provision for increasing state governments’ share of VAT revenue while reducing the federal government’s portion from 15 percent to 10 percent.
Adedeji Stanley Olajide highlighted Nigeria’s financial needs, particularly in education and technology.
“We require significant funding to grow our economy, especially in areas like artificial intelligence,” he noted, advocating for adequate resources to support technological advancements.
Isiaka Ibrahim suggested imposing penalties on tax evaders and officials mismanaging public funds.
“Taxpayers will be more willing to pay if they see their money being used appropriately,” he remarked.
However, some lawmakers raised concerns about the bill’s ambiguities. Rep. Sada Soli pointed out contradictions related to constitutional and jurisdictional matters.
“There must be clarity on key terms such as ‘derivation’ and ‘artificial transactions,’ which could cause implementation challenges,” he warned.
Babajimi Benson supported the bill’s state-centred approach, noting that it empowers states to collect revenue more efficiently.
“The bill allows states to collect stamp duties and increases their VAT share, which is a step toward fiscal federalism,” he said.
Nnolim Nnaji stressed the need for proper utilization of tax revenue.
“It’s not just about raising funds but ensuring they are used effectively for public services like electricity and healthcare,” he stated.
Clement Jimbo described the reforms as essential for national development.
“Reforms are crucial for progress. We need to close loopholes in our revenue system,” he asserted.
Abubakar Assam Fulata advocated digitizing the audit process to prevent companies from manipulating financial reports. He also cautioned against granting executive exemption orders, which could undermine tax integrity.
“There should be a system ensuring that financial reports submitted to different agencies remain consistent,” he proposed.
Fulata also raised concerns about double taxation, where both buyers and sellers of property could be taxed. Additionally, he opposed inheritance tax from a religious standpoint.
“As a Muslim, I cannot support inheritance tax. It is wrong to take from an orphan’s wealth and redistribute it,” he stated.
He further suggested a VAT-sharing formula based on 50% equity, 20% population, and 30% association.
While lawmakers largely supported the tax reforms, they highlighted issues requiring further deliberation at the public hearing stage.
The Speaker lauded members for their input and urged continued consultation as the bills proceed to the Committee on Finance for further scrutiny.
