The 19 state governors from Nigeria’s Northern region have expressed strong opposition to the recent Tax Reform Bill submitted by the Nigerian Government to the National Assembly.
Their primary concern is the proposed shift to a Derivation-based Model for the distribution of Value Added Tax (VAT), which they argue would disadvantage northern states and other less industrialized regions.
The governors, under the banner of the Northern States Governors’ Forum (NSGF), articulated their concerns in a communique issued following a strategic meeting in Kaduna. The meeting, attended by northern traditional rulers, Chief of Defence Staff General Christopher Musa, and other key stakeholders, focused on various issues impacting the region.
In their statement, the governors criticized the proposed amendments to the VAT distribution formula. Currently, VAT is remitted based on the location of company headquarters rather than where goods and services are consumed. The governors fear that the new model will significantly reduce revenue from the Federal Accounts Allocation Committee, adversely affecting their states.
The communique read in part: “The forum notes with dismay the content of the recent Tax Reform Bill that was forwarded to the National Assembly. The contents of the reforms are against the interest of the North and other sub-nationals, especially the proposed amendment to the distribution of Value Added Tax to a Derivation-based Model.”
They unanimously rejected the proposed amendments and urged members of the National Assembly to oppose any bill that could jeopardize the well-being of their constituents.
The forum also called for equity and fairness in the implementation of national policies, asserting that no geopolitical zone should be marginalized. “The Northern Governors’ Forum is not averse to any policies or programs that will ensure the growth and development of the country. However, we demand fairness in the implementation of all national policies,” the statement emphasized.
In light of the current economic challenges facing the country, the governors appealed to citizens to remain calm, assuring them that both state and federal governments are working diligently to implement measures that will alleviate the hardships being experienced.
