By Jason Feso
The House of Representatives has called for a nationwide framework that will compel tax authorities to issue Tax Clearance Certificates (TCCs) to workers within three months after the end of every tax year.
The resolution followed the adoption of a motion moved during Thursday’s plenary by Adebayo Balogun, who raised concerns over persistent delays in the issuance of the document to employees who already pay taxes through the Pay-As-You-Earn system.
Balogun said millions of Nigerian workers in both the public and private sectors fulfil their tax obligations through the PAYE deduction system but often struggle to obtain their tax clearance certificates when needed.
According to him, the delays have created bureaucratic bottlenecks that sometimes push workers to seek alternative or irregular means of obtaining the document for urgent transactions.
Lawmakers Seek National Framework
Following deliberations, lawmakers urged State Internal Revenue Services across the country to ensure that Tax Clearance Certificates for PAYE employees are issued within three months after the end of the preceding tax year.
The House also mandated its Committee on Finance to engage with the Joint Tax Board, the Nigeria Revenue Service and various State Inland Revenue Services to develop a harmonised national framework that would guarantee timely issuance of the certificates.
The committee is expected to report back to the House within four weeks for further legislative action.
Bottlenecks in Tax Administration
Balogun noted that the absence of a clearly defined timeline for issuing TCCs has created administrative inefficiencies within Nigeria’s tax administration system.
He added that many employees who urgently need the document for official processes are sometimes forced to spend additional money to obtain it.
Taxation of personal income in Nigeria is governed by the Personal Income Tax Act, which provides the legal structure for the assessment and collection of personal income tax.
Under Section 81 of the law, employers are required to deduct personal income tax from workers’ salaries through the PAYE system and remit it to tax authorities.
Section 85 further mandates tax authorities to issue a Tax Clearance Certificate once it is confirmed that the taxpayer has fully settled their tax obligations.
Why TCCs Matter
A Tax Clearance Certificate is an official document confirming that an individual or organisation has paid all due taxes for a specified period, typically the previous three years.
In Nigeria, the document is required for several official transactions such as bidding for government contracts, processing visa and immigration applications, opening certain financial accounts and contesting elective political offices.
Experts say delays in issuing the certificate undermine trust in the tax administration system and discourage voluntary compliance.
They argue that establishing a clear timeline for issuing TCCs would not only remove bureaucratic obstacles for workers but also improve transparency and efficiency in tax administration nationwide.
Juliet Ezeh is the founder and chief reporter at Westbridge Reporters with over 7 years of experience in journalism. She covers crime, industry, policy, and social developments, delivering timely and accurate reporting.