The Nigeria Governors’ Forum (NGF) has opposed any plans to increase the Value Added Tax (VAT) rate in the country.

The forum, representing governors from all 36 states, articulated their stance during a meeting with the presidential tax reform committee held on Thursday to deliberate on critical fiscal and tax reform issues.

In a statement signed by the NGF Chairman and Governor of Kwara State, AbdulRahman AbdulRazaq, the governors emphasized their commitment to comprehensive tax reform while advocating against measures that could exacerbate economic challenges.

“We, members of the Nigeria Governors’ Forum (NGF) and the Presidential Tax Reform Committee, convened to deliberate on Nigeria’s fiscal policies and tax system. After extensive discussions, we arrived at the following resolutions,” the statement read.

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“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 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 governors said.

The governors proposed a revised VAT-sharing formula to ensure a fairer distribution of resources across states:

50% based on equality among states, 30% based on derivation (revenue generated from a state), and 20% based on population.

The forum recommended removing terminal clauses for the Tertiary Education Trust Fund (TETFUND), National Agency for Science and Engineering Infrastructure (NASENI), and National Information Technology Development Agency (NITDA) in the allocation of development levies under tax reform bills.

The governors expressed their support for the ongoing legislative process at the National Assembly to finalize the Tax Reform Bills.

Governor AbdulRazaq stressed the importance of balancing fiscal reforms with the welfare of Nigerians. “Our tax reform efforts must reflect fairness, equity, and the need to protect our citizens, particularly during these economically challenging times,” he stated.

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