The Northern States Governors Forum on Monday asked lawmakers of northern extraction in the National Assembly to reject the Tax Reform Bill presented by President Bola Tinubu.
The influential Northern Governors’ Forum arrived at the resolution after a meeting in Kaduna.
They had openly rejected some of the proposals, particularly the VAT sharing template in one of the bills.
This was contained in a communiqué issued at the end of the meeting and read by the Governor of Gombe State, Yahaya.
According to communique, the tax bills are against the interests of the North. Therefore, the Forum instructed the Northern lawmakers to reject the bills.
Recall that President Tinubu, had in October, sent four fiscal bills to the National Assembly for consideration. These include the Nigeria Tax Bill 2024, the Tax Administration Bill, the Nigeria Revenue Service Establishment Bill, and the Joint Revenue Board Establishment Bill.
One of the bills proposes changing the sharing formula of the Value Added Tax. And also reducing the Federal Government’s share from 15 percent to 10 percent. However, the Bill includes a caveat that the allocation among States will consider the derivation principle.
“This is because companies remit VAT based on the location of their headquarters and tax office. Rather than where the services and goods are consumed. In view of the foregoing, the Forum unanimously rejects the proposed Tax Amendments and calls on members of the National Assembly to oppose any Bill that could jeopardize the well-being of our people,” said Mr. Yahaya.
Yayaha who also serves as the Chairperson of the Forum, added that while the Governors are not against reforms, the forum demands equity and fairness.
He said, “For the avoidance of doubt, the Northern Governors’ Forum is not opposed to policies. Or programs aimed at fostering national growth and development. However, the Forum calls for equity and fairness in implementing all national policies and programs. This is to ensure that no geopolitical zone is short-changed or marginalized.”
The Northern Governors are relying on the fact that the 19 Northern States and the FCT have the majority in the National Assembly. This means the region can have its way on any Bill if it secures the bloc vote of its lawmakers. Their bloc vote will definitely surpass the threshold of the simple majority they need to shoot down or successfully back a Bill in both chambers.
Recall that the Value Added Tax, VAT, has been a contentious issue for years between the Federal Government and the States. This is even as some States have previously challenged the legality of the Federal Government collecting VAT.
In 2021, the Federal High Court in Port Harcourt, Rivers State, issued an order restraining the Federal Inland Revenue Service (FIRS) from collecting Value Added Tax (VAT) and Personal Income Tax (PIT) in Rivers State.
Subsequently, Nyesom Wike, then Governor of Rivers State, signed into law a Bill which authorizes the Rivers State Government to henceforth collect Value Added Tax (VAT) in the State. A development which sparked a legal tussle between the State and the Federal Government. Lagos State also expressed interest in joining the suit over VAT.
The Governors in attendance were Uba Sani of Kaduna State, Inuwa Yahaya of Gombe and Dauda Lawal Dare of Zamfara. Also present were Abdullahi Sule of Nasarawa, Babagana Zulum of Borno, Bala Mohammed of Bauchi and AbdulRahman AbdulRazaq of Kwara.
The Adamawa State Governor, Ahmadu Umaru Fintiri and some Deputy Governors who represented their principals were also at the meeting.
source: Premium Times
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