Some northern lawmakers in the House of Representatives have indicated that the Nigeria Governors Forum’s (NGF) endorsement of the revised Value-Added Tax (VAT) sharing formula in the proposed tax bills may be subject to amendments by federal lawmakers before passage.
In 2024, President Bola Tinubu submitted four tax bills to the National Assembly, following recommendations from the Presidential Taskforce on Fiscal Policy and Tax Reforms led by Taiwo Oyedele. The proposed bills include the Nigeria Tax Bill 2024, the Nigeria Tax Administration Bill, the Nigeria Revenue Service (Establishment) Bill, and the Joint Revenue Board (Establishment) Bill.
The bills have sparked diverse opinions, with northern leaders opposing the VAT provisions. On October 29, the Northern Governors Forum opposed the proposed tax amendment bills. Two days later, the National Economic Council advised Tinubu to withdraw the bills for broader consultations.
While the bills saw some success in the Senate, they faced stiff opposition in the House of Representatives, with over 70 northern lawmakers blocking debate on the general principles of the bills. Critics, including former Vice President Atiku Abubakar and Governors Bala Mohammed and Babagana Zulum, argued that the reforms could harm the northern economy, particularly the VAT derivation component.
Last week, the President achieved a breakthrough at a meeting between the NGF and the Oyedele-led committee. The 36 governors proposed that VAT revenue be shared 50% based on equality, 30% on derivation, and 20% based on population.
Speaking to journalists, Sada Soli, representing Jibia/Kaita Federal Constituency, expressed the House’s readiness to support the governors but noted that the bills might face amendments during debates. He emphasized the need for thorough scrutiny to correct fundamental drafting errors.
Joshua Gana, a PDP lawmaker from Niger State, confirmed that the northern caucus had not met over the bills, as the House is mourning the recent death of Deputy Whip Hon Adewunmi Onanuga. He added that caucuses are free to deliberate until the House reconvenes on January 28, 2025.
Terseer Ugbor, representing Kwande/Ushongo Federal Constituency, echoed Gana’s position, indicating that the northern caucus has yet to take a firm stand on the governors’ support for the bills.
Meanwhile, the Arewa Consultative Forum (ACF) is studying the tax reform proposals and plans to provide specific recommendations within 48 hours. ACF National Publicity Secretary Prof Tukur Muhammad-Buba stated that the forum is generally satisfied with the equity, population, and derivation considerations in the proposals.