KADCCIMA pleads with president Tinubu to address gaps in proposed tax reforms
Kaduna Chamber of Commerce, Industry, mine and Agriculture (KADCCIMA) has pleaded with President Bola Ahmed Tinubu to reconsider and address some inherent gaps contained in his proposed tax reforms.
A statement signed by the president/chairman of council, Esv. Ishaya Idi, made available to newsmen noted that if left unchecked, these gaps may impede the implementation of the law when passed into an act of parliament.
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“We have observed with keen interests the recent bill sent by His Excellency, the
President of the Federal Republic of Nigeria, President Bola Ahmed Tinubu GCFR on Tax Reform, and the comments made by well-meaning individuals
and organizations regarding its consequences to various constituent parts of the nation.
“As a leading member of the Organised Private Sector, we want to lend our voices on the clarion call to His Excellency the President of the Federal Republic of Nigeria to please reconsider the issues raised in the proposed bill, particularly as it relates to the sharing formula proposed in the bill.
“The major issue is the Clause that proposed 60% of the VAT received will go to the state of collection. This to us as a Business Member Organisation needs to be seriously and carefully looked into as it could lead to complex
operation (implementation) of the bill if and when eventually it becomes an Act of Parliament.
“A situation whereby the proposed amendments state that revenue generated from Value Added Tax (VAT) will be shared on the derivation-based model and will definitely put a number of regions at a disadvantaged position. This is because companies compute and remit VAT using the location of their headquarters and tax office and not where services and goods are consumed.
“What this means is that some states will be short-changed because major
companies will pay their VAT to Lagos state, where their headquarters are instead of the states where they have their operations or location where the service and or product are consumed.
“It should be to note that VAT is consumption tax, which should be paid at the point of consumption and not the point of production. It is against this background that we wish to appeal to the President, Federal Republic of Nigeria, to reconsider this bill because of its serious implications (economic, social, and political).
“As a Chamber, we want to advise that the following measures be taken: Vis
“i. That His Excellency uses the tax reform to include proper attribution of
tax to areas of collection before derivation.
“ii. For fairness and justice, the president should conduct public hearing in
all the 6 geo-Political zones
Doing these will help in no small measure in coming up with an agreeable formula and pattern on the model that will be fair, equitable, and acceptable to all,” Idi said.
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