NEC Urges Withdrawal of Controversial Tax Bills for Stakeholder Review

The National Economic Council (NEC), led by Vice President Kashim Shettima, has advised the government to withdraw pending tax reform bills in the National Assembly. 

The recommendation follows disagreements surrounding the proposed Value Added Tax (VAT) distribution method, with Northern Governors, headed by Gombe State’s Governor Inuwa Yahaya, rejecting a derivation-based VAT model. 

This stance, clarified by Governor Abdullahi Sule of Nasarawa, reflects northern concerns over the financial impact on states with lower VAT revenue generation, primarily in the north.

Sule emphasized that while Northern leaders support President Bola Ahmed Tinubu, they believe the derivation model would disproportionately benefit VAT-generating states in the south. 

The revised bill aims to reallocate VAT based on product consumption rather than origin. Special Adviser Bayo Onanuga explained that this approach ensures fair distribution, especially for northern states contributing to national food production. NEC’s call for bill withdrawal is intended to allow broader stakeholder engagement to address concerns and foster equitable taxation.

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