The Chairman, Presidential Fiscal Policy and Tax Reforms Committee, Taiwo Oyedele, has stated that KPMG doesn’t under the tax reform. This follows KPMG mentioning weakness in the tax reform.
KPMG is a consulting firm and in their analysis of the Nigerian Tax Act, they pinpointed some errors and omission in the new tax law.
KPMG said:
“There are certain errors, inconsistencies, gaps, omissions, and lacunae in the new tax laws that need to be urgently reconsidered to ensure the attainment of the stated objectives”.
Reacting to this Oyedele said that even though KPMG’s perspective about the new tax reform is welcomed but most of it’s opinion reflects a misunderstanding of it’s policy.
Oyedele said:
“We welcome all perspectives that contribute to a shared understanding and successful implementation of the new tax laws.
“We acknowledge that a few points raised by KPMG are useful, particularly where they relate to implementation risks and clerical or cross-referencing issues.
“However, the majority of the publication reflected a misunderstanding of the policy intent, a mischaracterisation of deliberate policy choices, and, in several instances, repetitions and presentation of opinion and preferences as facts.
“A significant proportion of the issues described as “errors,” “gaps,” or “omissions” by KPMG are either: The firm’s own errors and invalid conclusions, Issues not properly understood by the firm.
“Missed context on broader reforms objectives. Areas where KPMG prefer different outcomes than the choices deliberately made in the new tax laws, and
“Obvious clerical and editorial matters already identified internally. While it is legitimate to disagree with policy direction, disagreements should not be framed as errors or gaps.
“KPMG would have been more effective if the firm adopted a similar approach like other professional firms who engaged directly providing the opportunity for clarifications and mutual-learning.
It is equally important to distinguish between policy choices designed to achieve the reform objectives and proposals that merely represent a firm’s preference.”
“In any comprehensive overhaul of a nation’s tax framework, clerical inconsistencies or cross-referencing gaps may occur, and these are already being identified within the government.
“The tax reform represents a bold step toward a self-sustaining and competitive Nigeria. An effective review needs to connect identified gaps to clear policy intentions and the reality of modern-day tax systems within the context of economic development and global competitiveness.
“At this stage, the effectiveness of the tax law depends on administrative guidance, clarifications from the tax authority, and regulations to complement precise statutory provisions where necessary pending future amendments.
“We urge all stakeholders to pivot from a static critique to a dynamic engagement model, which allows for clarifications and a productive partnership in the implementation of the new tax laws.”