The Chairman of the Presidential Committee on Tax Policy and Fiscal Reforms, Mr. Taiwo Oyedele has declared that the reforms sought to protect the very segment of the country that are opposed to the bills.
Speaking on ‘The Morning Show,’ an Arise Television programme, yesterday, Oyedele said the Federal Government believed that the resistance would come from Lagos and Rivers states.
He expressed disappointment over the rejection of tax reform bills, adding that the push-back was not expected from those opposing it.
“We had not envisaged that there was going to be push-back from the other states; we thought the push-back would come from Lagos mostly, maybe a little from Rivers. It’s almost like we ended up with the people we are fighting for are now fighting us.”
Oyedele noted that VAT derivation was sensitive for states due to its difference from oil and gas derivation, based on production.
Oyedele also noted that the Federal Government’s proposal aligned with the provision of the constitution. He said: “VAT derivation I think that word is sensitive because people think about where it’s based on production. If they’re not producing crude oil, you don’t get any part of that derivation.
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“Whereas for VAT, every state consumes. If you share anything based on VAT derivation, everyone gets something from it.
“The Constitution, with respect to stamp duty, under Section 163, should be shared based on derivation.
“So what we are proposing is not strange to our constitution. When it comes to matters of tax generation, we must recognise where they’re being generated otherwise we end up in a situation where one state will get a supreme court judgment.”
