State governors across Nigeria have called on President Bola Ahmed Tinubu to delay the implementation of the proposed Tax Reform Bills, citing the need for further clarifications and consultations. Nasarawa State Governor, Abdullahi Sule, outlined these concerns during a Channels TV town hall meeting on the bills held on Monday.
Governor Sule emphasized that while the governors appreciate and welcome the Tax Reform Bills, certain provisions require more detailed explanations. “The issue of increasing VAT from 20 percent to 60 percent at the point of generation was a major concern. However, I’m pleased to hear that this has been revised to include consumption as well, which is an improvement,” Sule said.
He added that the governors believe broader discussions should have taken place before the bills were presented to the National Assembly. “The governors said, ‘Why don’t you withdraw the bills, let us discuss them, let us understand them,’” Sule noted, underscoring the need for collaborative engagement.
Tax Reform Committee Responds
Responding to the governors’ concerns, Taiwo Oyedele, Chair of the Tax Reform Committee, acknowledged their feedback and expressed willingness to address the issues raised. Oyedele explained that the committee had initially tried to engage the public on the bills but faced limited interest. He assured that the committee is now ready to clarify and explain the provisions further, particularly as the bills have sparked increased interest and debate.
Controversy Over Regional Disparities
The proposed Tax Reform Bills have been met with significant resistance, especially from the Northern Governors Forum. Borno State Governor, Prof. Babagana Zulum, expressed strong reservations, arguing that the reforms would disproportionately benefit Lagos and Rivers states while disadvantaging northern states.
“Based on the calculations we did, only Lagos and Rivers states will benefit from this scheme. Northern states will lose significantly,” Zulum stated during a Channels TV program on Sunday. He urged the Federal Government to pause the process and remove provisions that could harm the North’s economic interests.
Zulum further argued that rushing the bills through the National Assembly without deeper consultation could exacerbate regional economic imbalances. “What we are saying is, give more time, let us do a deeper consultation to understand the nitty-gritty of this tax regime before passing it into law,” he said.
Calls for Consensus
Both Sule and Zulum echoed the need for a more inclusive approach to tax reforms, emphasizing that they should be tailored to benefit all regions equitably. The governors’ concerns underscore the broader debate about balancing revenue generation with fair distribution across Nigeria’s diverse economic landscape.
The controversy surrounding the Tax Reform Bills highlights the complexity of reforming Nigeria’s tax system, with implications for governance, regional equity, and economic development. Whether President Tinubu and the National Assembly will heed the governors’ calls for a pause and further consultations remains to be seen.