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Nigeria Governors’ Forum Endorses Revised VAT Sharing Formula

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10 hours ago

January 16, 2025

Editorial Team

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… Supports Tax Reform Bills

By Oluronke Kuku

The Nigeria Governors’ Forum (NGF) has issue a communique outlining its stance on key national issues, including tax reform and fiscal policies.

The communique, signed by Chairman and Governor of Kwara State, His Excellency, AbdulRahman AbdulRazaq, highlighted the forum’s resolutions after a meeting with the Presidential Tax Reform Committee on January 16, 2025.

The key resolutions were classified into five areas as contained in the communique which firstly focused on the Revised VAT Sharing Formula. The Forum endorse a revised Value Added Tax (VAT) sharing formula, allocating 50% based on equality, 30% based on derivation, and 20% base on population.

Secondly, it was resolved that there will be No VAT Rate Increase. Members of the Committee agreed not to increase the VAT rate or reduce Corporate Income Tax (CIT) to maintain economic stability.

Thirdly, emphasis was made on the need to exempt the essential Goods. The Forum advocated for the continue exemption of essential goods and agricultural produce from VAT to safeguard citizens’ welfare and promote agricultural productivity.

Also, the fourth point raise the need to introduce development levies. The meeting recommended removing terminal clauses for TETFUND, NASENI, and NITDA in the sharing of development levies.

The last point reveals the need to support the Tax Reform Bills. The Forum equally supports the continuation of the legislative process for the Tax Reform Bills, aiming for their eventual passage.

The resolutions however demonstrated the NGF’s commitment to comprehensive tax reform, fiscal stability and equitable resource distribution.

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