The Nigeria Governors’ Forum (NGF) has rejected plans to increase the Value Added Tax (VAT) rate in the country. The governors believe that increasing VAT would exacerbate economic challenges and instead proposed a revised VAT-sharing formula to ensure fair distribution of resources across states.
Key Points of the Revised VAT-Sharing Formula:
- 50% based on equality among states
- 30% based on derivation (revenue generated from a state)
- 20% based on population
The governors also advocated for the continued exemption of essential goods and agricultural produce from VAT to safeguard citizens’ welfare and promote agricultural productivity. Additionally, they recommended removing terminal clauses for certain development levies under tax reform bills.
Source: Nairametrics
