Reps to probe N8tr revenue loss from tax incentives, waivers

The House of Representatives has initiated a probe into the alleged misuse of tax incentives, waivers, and exemptions, which has reportedly resulted in a revenue loss of N8 trillion for the Federal Government.

The decision was made on Thursday following the adoption of a motion of urgent public importance moved by Oluwole Oke, representing Oriade/Obokun Federal Constituency in Osun State. This follows a similar motion adopted on July 14, 2023, which did not yield substantial action.

The House expressed concern that tax waivers and exemptions, intended to attract investments and stimulate economic activities, have instead become a major source of revenue leakage.

According to data presented during the session, Nigeria loses approximately N8 trillion annually—N6 trillion due to companies exploiting the system and N2 trillion from mismanaged waivers.

The investigation will focus on areas where the abuse is most prevalent, including capital allowances, investment allowances, pioneer status incentives, free trade zone exemptions, and value-added tax (VAT) exemptions.

Lawmakers also raised concerns that these loopholes have significantly reduced Nigeria’s tax-to-GDP ratio, which currently stands at 10.6 percent—one of the lowest in Africa.

The House mandated its Committees on Industry, Finance, and Commerce to conduct a comprehensive investigation and submit a report within four weeks.

The findings are expected to guide further legislative measures to curb revenue losses and strengthen Nigeria’s fiscal framework.