Tax reform bills: Oyedele speaks on NGF’s VAT sharing formula, subsidy removal

• Taiwo Oyedele has spoken on the position of the presidential tax committee on the proposed Value-Added Tax sharing formula by the Nigeria Governors’ Forum
• He said the committee is not opposed to the NGF’s proposed formula
• Oyedele said fuel subsidy was economic sabotage and unsustainable

The Chairman of the Presidential Committee on Tax Policy and Fiscal Reforms, Taiwo Oyedele, has stated the position of the committee on the newly proposed Value-Added Tax (VAT) sharing formula by the Nigeria Governors’ Forum (NGF).

While speaking on Saturday, January 18, at The Platform, an event organised by The Covenant Nation to facilitate national development, Oyedele said the committee is not opposed to the NGF’s proposal.

He said like reforms anywhere in the world, the tax reform bills will go through fine-tuning overtime before proposed changes are achieved.

Oyedele said, “You also need to consider other things, including political considerations, and so once the governors proposed their formula for sharing the VAT revenue, we have no objections to that, because, at the end of the day, if you need to move one kilometre, you don’t have to move all of that at once; you can’t even jump one kilometre at once.

“Maybe sometimes you need to just move gradually. You know, you take a breather. You reflect, have more data, and then you move again.”

It will be recalled that the NGF, on January 16, supported the tax reform bills currently at the National Assembly.

The Forum proposed an equitable VAT sharing formula of 50 per cent based on equality, 30 per cent based on derivation, and 20 per cent based on population as opposed to the Oyedele-led committee’s 20 percent based on equality, 60 percent based on derivation, and 20 percent based on population formula.

Fuel subsidy was economic sabotage and unsustainable

Speaking on the government’s removal of fuel subsidy, Oyedele noted that the regime was replete of economic sabotage and unsustainable as it gave Nigerians a false sense of the affordability of petroleum products.

He added that with the policy, electricity tariff and exchange rates did not reflect their true economic values, leading to fiscal imbalances.

“Removing subsidies is the best decision we made as a country. And we can now say that for once, the subsidy is gone.

“We were living in window-dressed realities. If you look back to about two years ago, the naira exchange rate was N450 depending on who you asked. But was our exchange rate really N450? If you wanted to buy petrol, it was under N200 per litre, but was it really under N200 per litre? 

“A country can afford to sell petrol at N200 per litre if you can afford it. But there is everything wrong if you cannot afford it,” he said.

Oyedele says tax reform bills will be enacted, implemented early

Meanwhile, TheRadar earlier reported that the Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, Taiwo Oyedele, sais the tax reform bills will be signed into law in the first quarter (Q1) of 2024, while implementation will commence in July.

Oyedele disclosed this at the 2025 Lagos Chamber of Commerce and Industry (LCCI) Economic Review and Outlook Conference, held in Lagos, recently.