Northern governors have united to oppose the proposed Tax Reform Bill, arguing that the bill’s revenue distribution model could disadvantage the region.
The Northern Governors’ Forum, led by Gombe State Governor Mohammed Yahaya, has urged lawmakers to reject the bill, citing concerns that the region may be “short-changed” as high-tax-paying multinationals are predominantly headquartered outside the North.
In a communiqué delivered on Monday at the Kaduna State Government House, Governor Yahaya articulated the North’s stance, stating that the bill’s proposed shift to a derivation-based VAT distribution—where states retain more tax revenue based on their contributions—would disproportionately favor states with a higher concentration of corporate headquarters, mostly located in the South.
Yahaya highlighted that the North would suffer under the amendment as VAT is remitted from corporate headquarters rather than the actual locations where goods and services are consumed.
The governor maintained that, under the current model, VAT revenues are more equitably shared nationwide.
“The contents of the bill are against the interests of the North and other sub-national regions, especially with its proposed shift towards a derivative-based VAT model,” Yahaya stated.
He added that “The Forum unanimously rejects the proposed tax amendments and urges members of the National Assembly to stand against any policy that may harm our people.”
In the communiqué, Yahaya called for a fair and balanced approach to tax reforms, requesting lawmakers to ensure that “no geopolitical zone is marginalized or denied its fair share.”
Gombe State, which enforces Sharia law, remains one of Nigeria’s states with low internally generated revenue, recording N13.6 billion according to 2022 data from the National Bureau of Statistics.
The debate underscores the complex interplay between regional economies, religious policies, and federal revenue distribution, with northern governors adamant that the reform could exacerbate existing regional inequalities.
