Tax reform bills: Northern stakeholders demand VAT reduction to 3%

Stakeholders in Northern Nigeria have called for the reduction of Value Added Tax (VAT) to 3% and the relocation of corporate headquarters of banks and telecommunications companies to Abuja to address perceived inequities in the proposed tax reform bills.

The demands were made at a town hall meeting organised by the Coalition of Northern Groups (CNG), civil society organisations (CSOs), and other stakeholders at Arewa House, Kaduna, on Thursday.

Reading from the communique, Comrade Muhammed Sanusi Ali, who noted that he was speaking on behalf of 134 CSOs/NGOs in the region, also criticised the current VAT distribution formula, which allocates revenue based on the location of a company’s headquarters rather than where goods and services are consumed.

He also argued that stakeholders saw the system as disproportionately benefiting certain regions, leaving others at a disadvantage.

“Abuja, being the Federal Capital, should serve as a neutral ground for the corporate headquarters of these companies to ensure fair revenue distribution,” a resolution from the meeting stated.

On VAT, the stakeholders also demanded that the Federal Government reduce the rate to 3%, rather than increasing it as proposed.

According to them, “This would provide relief to struggling businesses and citizens already grappling with the effects of subsidy removal and inflation.”

The meeting also called for increased funding for agencies such as TETFUND, NITDA, and NASENI to sustain innovation and education, while urging the Federal Government to reconsider the tax reform bills entirely.

The signed resolutions from the event are to be submitted to Northern lawmakers in all 19 states, urging them to reject the reforms in their current form.

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