Nigeria Governors’ Forum (NGF) finally backed the proposed tax reform bills currently at the national assembly.
In a statement on Thursday, the forum proposed an “equitable” sharing formula for value-added tax (VAT).
According to the statement, the governors recommended that there should be no terminal clause for 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.
They also supported the continuation of the legislative process at the national assembly that will culminate in the eventual passage of the tax reform bills.
“The Forum reiterated its strong support for the comprehensive reform of Nigeria’s archaic tax laws. Members acknowledged the importance of modernizing the tax system to enhance fiscal stability and align with global best practices,” the statement reads.
“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 group advocated for the continued exemption of essential goods and agricultural produce from VAT to safeguard the welfare of citizens and
promote agricultural productivity.
