Afenifere Backs Proposed Tax Reform, Says It’s Not Regionally Biased

The pan-Yoruba socio-cultural organization, Afenifere, has voiced support for the Federal Government’s proposed tax reform, asserting that it is not targeted at any specific region.

This comes after President Bola Tinubu submitted four bills to the National Assembly aimed at streamlining Nigeria’s tax processes, enhancing efficiency, and removing redundancies.

In response to concerns raised by the Northern State Governors’ Forum (NSGF) and Northern Council of Traditional Rulers, who expressed dissatisfaction with the proposed derivation-based VAT distribution model, the chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, Taiwo Oyedele, clarified that the reforms aim to rectify flaws in current tax laws.

Oyedele noted the current revenue-sharing model allocates 15% of VAT to the federal government, 50% to states, and 35% to local governments.

The proposed bill would adjust this to 10% for the federal government, 55% for states, and 35% for local governments, as outlined in Section 22 (12) of the Nigeria Tax Administration Bill.

Afenifere’s National Publicity Secretary, Jare Ajayi, released a statement affirming that the reform poses no threat to any region’s share of VAT revenue.

“Including derivation as a distribution factor will not deprive any state of its due share,” Ajayi stated.

The group highlighted that the Nigeria Tax Bill aims to reduce multiple taxation and increase economic competitiveness, while the Nigeria Tax Administration Bill seeks to harmonize tax processes across federal, state, and local levels. Other bills propose renaming the Federal Inland Revenue Service (FIRS) to Nigeria Revenue Service and establishing a Joint Revenue Board to replace the Joint Tax Board.

Afenifere underscored that since VAT is collected based on consumption within each state, all states stand to benefit from the revenue.

It added that the reform aligns with Section 163(b) of the 1999 Constitution, which supports derivation in revenue distribution.

The group emphasized that this structure would encourage states to generate more local revenue, enhancing their contributions to the national economy.