The Nigeria Governors’ Forum (NGF) convened for its first meeting of 2025 at the forum’s secretariat in Abuja on Wednesday.
Notably, the meeting was attended by the American Ambassador to Nigeria, Richard Mills, and the Minister of Women Affairs, Imaan Sulaiman-Ibrahim, alongside several state governors, including those of Kwara, Lagos, Abia, and Ogun, as well as some deputy governors.
The agenda of the meeting was not made public at the time of the gathering. However, one of the key topics discussed was the ongoing tax reform bills introduced by President Bola Tinubu.
In a communique issued at the conclusion of the meeting, the NGF reaffirmed its support for the Federal Government’s tax reform initiatives, which include proposals to overhaul Nigeria’s tax system. However, the governors proposed a new sharing formula for Value Added Tax (VAT) revenue to ensure a more equitable distribution of resources across the country.
The NGF’s proposed VAT-sharing formula suggests that 50% of the funds should be allocated based on equality, 30% on derivation, and 20% on population. According to the NGF, the new sharing formula will be “50% based on equality, 30% based on derivation, and 20% based on population.”
The forum also stressed the importance of maintaining economic stability by recommending “that there should be no increase in the VAT rate or reduction in Corporate Income Tax (CIT) at this time, to maintain economic stability.”
Furthermore, the NGF advocated for the continued exemption of essential goods and agricultural produce from VAT to safeguard citizens’ welfare and encourage agricultural productivity.
“The Forum advocated for the continued exemption of essential goods and agricultural produce from VAT to safeguard the welfare of citizens and promote agricultural productivity,” the communique stated.
The governors also raised concerns about the sharing of development levies from the proposed tax reforms, recommending that there be no terminal clause for the Tertiary Education Trust Fund (TETFUND), National Agency for Science and Engineering Infrastructure (NASENI), and the National Information Technology Development Agency (NITDA) in the sharing structure.
Despite some opposition and heated debates surrounding the proposed tax reform bills, the governors expressed their support for the continued legislative process at the National Assembly, urging lawmakers to pass the bills.
“Members agreed that there should be no increase in the VAT rate or reduction in Corporate Income Tax (CIT) at this time, to maintain economic stability,” the communique stated.
Last year, President Tinubu sent four tax reform bills to the National Assembly, including the Tax Administration Bill, Nigeria Tax Bill, and the Joint Revenue Board Establishment Bill.
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Additionally, the president has proposed repealing the law establishing the Federal Inland Revenue Service (FIRS) and replacing it with the Nigeria Revenue Service.
The tax reforms have faced resistance, particularly from some northern governors and regional leaders who argue that the proposals may not serve the best interests of their region. Some have even labeled the bills as “anti-north.”
Despite this, President Tinubu has remained steadfast, asserting that the reforms are “not against any section of the country,” but are instead intended to “improve the lives of Nigerians.”
