Governors of the Northern States have voiced concerns about the new derivation-based VAT model in Nigeria’s tax reform bills. The governors’ forum, chaired by Gombe State Governor Muhammed Inuwa Yahaya, met on October 28, 2024, to express their stance.
The Federal Government (FG), meanwhile, assures that the reforms will benefit all states. The reforms, endorsed by President Bola Tinubu and the Federal Executive Council, are designed to modernize tax administration without increasing existing tax rates.
The Nigeria Tax Bill aims to make Nigeria’s economy more competitive by simplifying tax obligations, while the Nigeria Tax Administration Bill proposes harmonized tax processes across federal, state, and local jurisdictions.
The Joint Revenue Board Establishment Bill also aims to integrate CIT, PIT, CGT, VAT, PPT, and excise duties into a unified structure, reducing fragmentation. A new proposal for VAT distribution would be based on where goods are consumed rather than collected, promoting fairness.
The reforms intend to eliminate redundancies, foster cooperation among tax bodies, and open new opportunities for job creation.
