Governor Abdullahi Sule of Nasarawa State has expressed concerns about the ongoing debate surrounding the proposed tax reform bills before the National Assembly. He stated that many critics of the bills lack a fundamental understanding of Value Added Tax (VAT) and its mechanisms.
Speaking during an interview with Arise Television on Monday, Governor Sule acknowledged that some northern governors, including himself, initially had reservations about certain aspects of the tax bills. However, he noted that recent clarifications from President Bola Tinubu and Taiwo Oyedele, Chairman of the Presidential Advisory Committee on Fiscal Policy and Tax Reform, have helped address many concerns.
“The unfortunate part of this debate is that it has been taken over by people with zero knowledge about VAT or the bills themselves,” Sule remarked. He added, “Some are doing it to save their jobs, others for political gain, and some for reasons unrelated to the real issues at hand. This has made the discourse unproductive and uninteresting.”
One key point of contention in the bills was the perception that VAT would only be administered at the point of revenue generation. According to Sule, this misunderstanding sparked widespread opposition. However, he clarified that VAT sharing would involve both the points of revenue generation and consumption.
During the meeting in Kaduna, we were initially told that 60% of VAT revenue would be allocated solely at the point of generation, Sule explained. But Mr. Oyedele later clarified that the 60% would be shared between the point of generation and the point of consumption. This adjustment addresses one of our key concerns.
Governor Sule, also the Chairman of the North Central Governors Forum, emphasized that the initial request for the withdrawal of the bills might no longer be necessary. He pointed out that President Tinubu and Oyedele have assured the governors that the bills could be amended to reflect stakeholders’ concerns.
What we wanted was for the contentious areas to be discussed and addressed, and that is already happening, Sule said. The bills don’t necessarily need to be withdrawn if amendments can incorporate our suggestions. This approach ensures progress without disrupting the legislative process.
Governor Sule commended President Tinubu for being open-minded and addressing concerns regarding the bills. He revealed that during a recent meeting, Tinubu assured the governors that their concerns would be reviewed and addressed.
In our last meeting with Mr. President, he confirmed his willingness to look into the bills and address areas of concern, Sule stated. Similarly, Taiwo Oyedele and Zach Adedeji, who are key figures behind these reforms, have shown a readiness to engage in constructive dialogue.
The proposed tax reform bills have sparked a heated national debate, particularly due to strong opposition from some governors. Critics fear that the reforms could worsen regional inequalities and exacerbate existing economic challenges in their regions.
Notable figures, including Borno State Governor Babagana Zulum, have raised concerns about the socioeconomic impact of the bills. They argue that northern Nigeria, already grappling with high poverty levels and security challenges, could be disproportionately affected by the new tax regime.
In response to the mounting pressure from northern governors and lawmakers, the House of Representatives has decided to indefinitely suspend debates on the bill.