Tax Reform Bill: ‘It’s unjust for only four states to get 70 per cent of VAT’ – Shehu Sani

Former Senator Shehu Sani has said that it is unjust for only four states to receive 70 percent of the Value Added Tax (VAT) distribution.

 

The Federal Inland Revenue Service (FIRS) Chairman had told the House of Representatives that only four states take 70 percent of VAT, namely Lagos, Rivers, Oyo, and the FCT, citing an example of MTN paying most of its VAT to Lagos while all the states consume its services.

 

Reacting to this, Sani, in a statement via X, admonished critics of the Bill to remove their political lenses and read the document thoroughly.

 

He also said the Bill should be supported to end the prevailing tax injustice in the country.

 

“The revelation made yesterday by the FIRS Chairman before the House of Reps that presently only four states corner 70 percent of VAT, namely Lagos, Rivers, Oyo, and FCT, is unjust. This is a strong justification for the tax reform.

 

“He also cited an example of MTN paying most of its VAT to Lagos while all the states are paying for its services. I still admonish the critics of the Bill to remove their political lenses and read the document thoroughly.

 

“The Bill will ensure equity, fairness, and allocate more resources to all other states. All the sentiments raised against the Bill are not contained in the Bill. The Bill should be supported to end the prevailing tax injustice in the country,” he wrote.

 

Recall that governors of the 19 Northern states, under the platform of the Northern Governors’ Forum, at a meeting on October 28, 2024, in Kaduna, rejected the new derivation-based model for Value-Added Tax distribution in the new tax reform bills before the National Assembly.