Governors’ Forum throws weight behind Tinubu’s tax reform bills, proses new VAT sharing formula
Governor AbdulRahman AbdulRazaq-led Nigeria Governors’ Forum (NGF) have brainstormed with the Federal Government on the tax reform bills forwarded to the National Assembly by President Bola Tinubu, proposing a new sharing formula if the tax reform bills must see the light of the day.
According to Vanguard, the governors, at the end of a meeting of subnational consultations and engagement on Thursday in Abuja with the Chairman of the Presidential Fiscal Policy and Tax Reforms Committee, Taiwo Oyedele, declared their support for the continuation of the legislative process at the National Assembly that will culminate in the eventual passage of the Tax Reform Bills.
According to a communique issued by the NGF Chairman and Governor of Kwara State, Abdul Rahman Abdul Razaq, the Forum endorsed a revised VAT sharing formula to ensure equitable distribution of resources of 50% based on equality, 30% based on derivation, and 20% based on population, adding that there should be no increase in the VAT rate or reduction in Corporate Income Tax (CIT) at this time to maintain economic stability.
Furthermore, they have called for the continued exemption of essential goods and agricultural produce from VAT as that would help safeguard the welfare of citizens and promote agricultural productivity.
They also, at the end of the meeting, recommended that there should be no terminal clause for the Tertiary Education Trust Fund, TETFUND; National Agency for Science and Engineering Infrastructure, NASENI, and National Information Technology Development Agency, NITDA, in the sharing of development levies in the bills.
The communique read in part: “The Forum reiterated its strong support for the comprehensive reform of Nigeria’s archaic tax laws.
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“Members acknowledged the importance of modernising the tax system to enhance fiscal stability and align with global best practices.
“The Forum endorsed a revised Value Added Tax (VAT) sharing formula to ensure equitable distribution of resources: 50% based on equality, 30% based on derivation, and 20% based on population.
“Members agreed that there should be no increase in the VAT rate or reduction in Corporate Income Tax (CIT) at this time to maintain economic stability. The Forum advocated for the continued exemption of essential goods and agricultural produce from VAT to safeguard the welfare of citizens and promote agricultural productivity.
“The meeting recommended that there should be no terminal clause for TETFUND, NASENI, and NITDA in the sharing of development levies in the bills.
“The meeting supports the continuation of the legislative process at the National Assembly that will culminate in. the eventual passage of the Tax Reform Bills.”
Source: Vanguard newspaper
