The Nigeria Governors’ Forum and the presidential tax reform committee have agreed that there should be no increase in the Value Added Tax (VAT) rate or reduction in Corporate Income Tax (CIT) in the country.
The governors and the committee members reached the agreement at their meeting in Abuja on Thursday, January 16, 2024.
This was disclosed this in a communique issued by the NGF Chairman and Kwara State Governor, AbdulRahman AbdulRazaq.
AbdulRazaq stated: “The Forum reiterated its strong support for the comprehensive
reform of Nigeria’s archaic tax laws.
“Members acknowledged the importance of modernizing the tax system to enhance fiscal stability and align with global best practices.
“The Forum endorsed a revised Value Added Tax (VAT) sharing formula to ensure equitable distribution of resources: 50% based on equality, 30% based on derivation, and 20% based on population.
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“Members agreed that there should be no increase in the VAT rate or reduction in Corporate Income Tax (CIT) at this time, to
maintain economic stability.
“The Forum advocated for the continued exemption of essential goods and agricultural produce from VAT to safeguard the welfare of citizens and promote agricultural productivity.”
The governor noted that the meeting recommended that there should be no terminal clause for TETFUND, NASENI, and NITDA in the sharing of development levies in the bills.
“The meeting supports the continuation of the legislative process at the National Assembly that will culminate in the eventual passage of the Tax Reform Bills,” he added.
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