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Nigeria’s National Economic Council recommends withdrawal of tax reform bill 

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The National Economic Council (NEC) comprising the 36 state Governors and chaired by the Vice President, Kashim Shettima has recommended the withdrawal of the Tax Reforms Bill currently before the National Assembly.

This advice was given on Thursday after the council’s 145th meeting in Abuja.

The council’s recommendation was in response to a presentation by the Chairman of the Presidential Fiscal Policy and Tax Reforms Committee, Mr. Taiwo Oyedele, where it recommended more extensive consultation with stakeholders to ensure alignment on the significant impacts of the proposed tax reforms.

Governor Umaru Zulum of Borno also confirmed the council’s recommendation to withdraw the bill to enable consensus-building.

The recommendation of the NEC comes as another stumbling block to the success of the tax reform bills which have currently passed first reading in the senate.

Under Section 40 of the VAT Act, revenue is currently allocated as follows: 15% to the Federal Government, 50% to the States and FCT, and 35% to Local Governments, with a derivation principle ensuring at least 20% is distributed based on where the VAT is generated.

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