Muktar Mohammed Dissects The Tax Reform Bill Controversy

In this edition of #ThisMorning, Muktar Mohammed dissects the controversy around the tax reform bill and the call for its withdrawal by the National Economic Council #NEC #TaxReformBill #TaxReform #Tax

[@omaruyusufu9866]

We have been waiting for these governors to come out and fight insecurity in their states which is one of their essential prerogatives unfortunately we see them fighting against a bill in place and lieu of members of house of representatives and the national assembly.

[@AbdulwaheedOmobolaji]

You be mumu. North doesn't talk too much. Mention one single bill to solve insecurity that northern govs fight against. This bill is going to affect them so you want them to fold arms. Northern govsl do not say Tinubu govt should not increase tav if he wishes, but the sharing formular is where the problem lies. This bill on VAT is that of Wike which he failed during Buhari regime which Tinubu is stylishly bringing up. You guys can drink to stupor. North àlso produces food which are not taxed. If agricultural products also taxed north will also be rich. North do not fight against Tinubu increasing tax. They are fighting against the sharing formular

[@KayodeLawal-vz1ho]

VAT collections has a sharing formular whereby derivation has smaller basis compared to other sharing basis. This is may be againts the principle of fairness and equity. One of the objectives of the bill is to address this, such that states generating the most VAT are allocated more revenue when the VAT is shared amongst the states. Now, defining derivation relating to the sales of goods/services can be tricky. Should it be at the states where the goods are produced and distributed or the states where the goods/services are consumed? Regarding cement production for instance, Ogun, Kogi, Edo and Benue may argue that cement producers are concentrated in these states, hence they should get the bulk of the VAT allocation from cement. Other states such as Lagos, Kano, Rivers, Oyo, Anambra, Owerri, Etc may counter argue that they consume the bulk the cement produced. In other words, the bulk of cement produced is effectively sold in their states. This is quite tricky. Lagos also enjoys what is called the headquarter effect, whereby for ease of collection and administration by FIRS, VAT generated by a company's branches, production and sales outlets in other states are presumed to have been generated where the company is headquartered. This is also addressed in the bill.

[@yonduodi8693]

They have refused to fight insecurity in their states making their states NON condusive for business because there is VAT money to be shared. This is the first good idea from this useless government. You enjoy what you generate. This will help state governors and the various regions be more serious with security in their states...so that businesses can have options on where to go in Nigeria.

[@Joseph247100]

It was Lagos and Rivers that went to court. I think the supreme court recommended political solution.

[@Joseph247100]

The suggestion by NEC to withdraw the bill is most lazy suggestion ever on a national issue.

[@chidiebereudeh1694]

Federal government should first create Dry land port in every state before introducing such taxation

[@idaeom]

Why can't each state create the land port themselves? Rail transportation is no longer an exclusive responsibility of the Federal Government.