Tax Reform: NGF Proposes 50:30:20 Ratio for VAT Distribution

By Oyewale Oyelola

The Nigeria’s Governors Forum (NGF) has proposed new Value Added Tax distribution ratio amidst ongoing tax reform of President Bola Tinubu administration.

NGF Chairman and Kwara State Governor, Abdulrahman Abdulrazaq disclosed this on Thursday after 2-day sub national consultation with Presidential Tax Committee led by Taiwo Oyedele.

The Forum endorsed a revised VAT sharing formula of 50 percent (equality), 30 percent (derivation) and 20 percent based on population to ensure equitable distribution of resources.

According to Abdulrazaq, the meeting recommended that there should be no terminal clause for TETFUND, NASENI and NITDA in the sharing of development levies.

The Forum supports continuation of legislative process for tax reform bills in the National Assembly but opposed increase of current 7.5 percent VAT.