Nigeria can benefit from Trump’s External Revenue Policy despite global trade concerns -Taiwo Oyedele

The Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, Taiwo Oyedele, has warned that a recent policy unveiled by U.S. President Donald Trump could disrupt global trade and complicate international taxation systems.

However, the tax boss believes Nigeria can take advantage and navigate potential challenges if there is tax reform.

Oyedele shared his concerns and recommendations on Monday night on his X account following Trump’s announcement during his inauguration as the 47th President of the United States.

In his speech, Trump unveiled plans for an External Revenue Service, which he described as a mechanism to impose tariffs and taxes on foreign countries.

“Instead of taxing our citizens to enrich other countries, we tariff and tax other countries to enrich our citizens. For this purpose, we are establishing the External Revenue Service to collect all tariffs, duties, and revenue. It will be a massive amount of money pouring into our treasury coming from far,” Trump said.

Reacting to the development, Oyedele stated, “The 47th President of the United States, Donald J. Trump, announced plans to establish an External Revenue Service to impose tariffs and taxes on other countries.

This move could disrupt international trade and further complicate the already complex global tax system, highlighting the importance of our ongoing tax reforms.”

He emphasized the need for Nigeria to proactively address these potential challenges by revamping its tax system, adding, “We can better navigate potential challenges and seize any opportunities this development may present.”

Oyedele has been at the forefront of Nigeria’s tax reform efforts. On October 3, 2024, President Bola Tinubu submitted four tax reform bills to the National Assembly: the Nigeria Tax Bill, the Nigeria Tax Administration Bill, the Nigeria Revenue Service Establishment Bill, and the Joint Revenue Board Establishment Bill.

The proposed legislation has sparked widespread debate, with discussions focusing on equity, implementation strategies, and economic implications. The Nigerian Governors’ Forum (NGF) has endorsed a revised Value Added Tax (VAT) sharing formula to ensure equitable resource distribution among states. The formula allocates 50% of VAT revenue based on equality, 30% on derivation, and 20% on population.

Speaking at The Platform, a public policy event hosted by The Covenant Nation, Oyedele highlighted the importance of compromise in implementing reforms. “When it comes to reforms, you also need to consider political realities. If you need to move one kilometre, you don’t have to cover the entire distance at once. Sometimes, progress requires gradual steps,” he said.

As the world watches the potential ripple effects of Trump’s new revenue policy, Oyedele stressed the urgency for Nigeria to strengthen its fiscal framework to adapt to emerging global challenges.