The Northern Governors Forum, representing 19 northern Nigerian states, has strongly opposed President Bola Tinubu’s proposed Tax Reform Bill.
This bill seeks to revise the distribution model for Value Added Tax (VAT) from a centralized system to a derivation-based model, which allocates tax revenues based on where goods and services are consumed rather than the location of company headquarters.
The governors argue that this change would disadvantage less industrialized northern states, where industries are sparse, and some products like alcohol are restricted.
They contend that such a reform would reduce federal revenue allocations to the North and exacerbate regional inequalities. The governors also highlighted the broader need for fairness and equity in national policy implementation and have called on the National Assembly to reject the bill.
Traditional rulers from the region have joined the governors in rejecting the reforms, emphasizing the need for policies that do not marginalize any geopolitical zone.
A representative from the Presidential Committee on Fiscal Policy has acknowledged these concerns and suggested exploring alternative derivation models that might balance the interests of all regions.
