The Nigeria Governors’ Forum (NGF) has endorsed the proposed tax reform bills currently under consideration at the National Assembly, calling them a vital step toward modernizing the country’s fiscal policies.
In a communique issued on Thursday, the governors also recommended a revised Value Added Tax (VAT) sharing formula to ensure equitable distribution of national revenue.
The proposed formula allocates VAT proceeds as follows:
50% based on equality among states,
30% based on derivation,
20% based on population.
Key Decisions
The governors emphasized their commitment to fostering fiscal stability through comprehensive tax reforms. They also made the following recommendations:
No Increase in VAT or Corporate Income Tax (CIT) Rates
The governors urged that VAT rates remain unchanged to avoid burdening businesses and consumers. Similarly, they opposed any reduction in CIT at this time, citing the need to maintain economic stability.
Exemptions for Essential Goods and Agricultural Products: To safeguard the welfare of citizens and boost agricultural productivity, the NGF advocated for the continued exemption of these items from VAT.
Retention of Development Levies
The forum called for the uninterrupted allocation of development levies to agencies such as the Tertiary Education Trust Fund (TETFUND), the National Agency for Science and Engineering Infrastructure (NASENI), and the National Information Technology Development Agency (NITDA).
