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Reasons Northern Groups Oppose Tax Reform Bills

Published by Tope Fakinlede on December 1st, 2024.

Reasons Northern Groups Oppose Tax Reform Bills

The ongoing debate over the proposed Tax Reform Bill in the National Assembly has sparked strong opposition from the Coalition of Northern Groups (CNG). The coalition has raised alarms about the potential for the bill to exacerbate economic disparities between regions, particularly disadvantaging northern states such as Gombe.

Comrade Muhammad Usman Deba, the CNG’s Coordinator for Gombe State, expressed concerns that the bill’s provisions, particularly regarding the Value Added Tax (VAT) reform, could disproportionately favor economically advanced states, leaving less developed northern states further marginalized.

One of the major points of contention is the proposed VAT sharing formula, which allocates revenue based on the location where it is generated. According to the CNG, this approach would benefit wealthier states like Lagos, which generate significant VAT income, while poorer northern states, with less economic activity, would receive a smaller share of the tax revenues.

Deba warned that this imbalance could widen the economic gap between the North and South, fueling social unrest, increasing migration from the North to other regions, and further entrenching regional inequalities. The group also criticized the lack of transparency in the formulation of the bill, noting that there has been no clear data or analysis provided to support the proposed changes.

The CNG has called for the suspension of further discussions on the Tax Reform Bill until these concerns are addressed. They emphasized the need for a tax system that is equitable, transparent, and promotes national unity and economic prosperity for all regions. The coalition also urged Nigerians to advocate for reforms that would foster balanced growth and prevent further deepening of regional disparities.