By Yinka Kolawole
LAGOS—The Manufacturers Association of Nigeria, MAN, and the Centre for the Promotion of Private Enterprise, CPPE, an economic and business advocacy think tank, have faulted the decision by the National Assembly to reject a bill seeking to include Value-Added Tax, VAT, in the exclusive list, noting that their stance may lead to multiple taxations.
Reacting to the development, in a chat with Vanguard, Mansur Ahmed, President of MAN, said: “This may lead to multiple taxations which our association has always objected to. We can only hope the 36 states and FCT, and the Federal Government will find a workable framework that is equitable transparent and fair to all tax payers.”
Also, commenting, Dr Muda Yusuf, Chief Executive Officer of CPPE, said: “From the perspective of collection efficiency, it is not a bad idea to opt for centralised VAT collection. This should be done by the Federal Inland Revenue Service, FIRS. It has a robust structure, spread and capacity to discharge such responsibility.
“Besides, mandating the states to collect VAT presents many implementation challenges, especially with regards to inter-state transactions, and value chains that cover several states. There is also the risk of multiple taxations by states.
“The bigger issue to address is that of equitable distribution of whatever is collected. There should be a strong derivation factor in distribution to ensure fairness and equity.”
Recall that the National Assembly had on Tuesday, rjected a bill seeking to include VAT in the exclusive list.
The bill to “Alter Part I of the Second Schedule to the Constitution of the Federal Republic of Nigeria, 1999 to include VAT on the Exclusive Legislative List; and for Related Matters” failed to pass after both chambers of the National Assembly voted against it.