The House of Representatives on Thursday called for the timely issuance of Tax Clearance Certificates (TCCs) to workers in both the public and private sectors across the country.
The resolution followed the adoption of a motion moved during plenary by the lawmaker representing Eti-Osa Federal Constituency of Lagos State, Adebayo Balogun.
Taxation of personal income in Nigeria is governed by the Personal Income Tax Act, which provides the legal framework for the assessment, collection and administration of personal income tax in the country.
Section 81 of the Act establishes the Pay-As-You-Earn (PAYE) system, under which employers are required to deduct personal income tax from the salaries and wages of employees and remit the deductions to the relevant tax authorities on their behalf. Section 85 of the same law mandates tax authorities to issue a Tax Clearance Certificate once it is confirmed that a taxpayer’s liabilities for the relevant years have been fully settled.
Speaking on the motion, Balogun said many Nigerian workers who faithfully fulfil their tax obligations under the PAYE system often experience delays when seeking their Tax Clearance Certificates.
He said millions of Nigerians in both the public and private sectors dutifully discharge their tax obligations through the PAYE system but still face undue delays from tax authorities when applying for their certificates.
The lawmaker expressed concern that the absence of a clearly defined timeline for issuing the certificates has created administrative inefficiencies and unnecessary bureaucratic bottlenecks within the tax administration system.
He added that many affected employees are often compelled to resort to irregular means of sourcing or borrowing TCCs to meet urgent requirements such as processing official documents, financial transactions, school admissions for their children, or contesting political offices.
Balogun also noted that some PAYE employees are forced to spend money from their limited income to obtain the certificate when it becomes urgently required.
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Following the adoption of the motion, the House urged State Internal Revenue Services across the federation to ensure that Tax Clearance Certificates for PAYE employees are issued not later than three months after the end of the preceding tax year.
Lawmakers also mandated the House Committee on Finance to interface with the Joint Tax Board, the Nigerian Revenue Service and various State Inland Revenue Services to develop a harmonised national framework for the timely issuance of TCCs and report back to the House within four weeks for further legislative action.
A Tax Clearance Certificate is an official document issued by tax authorities confirming that an individual or corporate entity has fully paid all due taxes for a specified period, usually the preceding three years.
In Nigeria, the certificate is often required for a wide range of official and commercial transactions, including bidding for government contracts, processing visas and immigration documents, opening certain financial accounts, contesting elective offices and completing various regulatory processes.
Experts say delays in issuing the certificates create bureaucratic obstacles for taxpayers and undermine confidence in the country’s tax administration system, stressing the need for clear timelines and better coordination among tax authorities to improve efficiency and encourage voluntary tax compliance.