A member of the Presidential Committee on Fiscal Policy and Tax Reform, Albert Folorunsho, said that the proposed tax bill, which sparked controversy, has nothing to do with the North-South dichotomy.

In an interview with Arise News on Tuesday, Folorunsho said there was a major misunderstanding of the proposal, stating that people have given the wrong explanation of the bill.

Folorunsho emphasized that the language of the bill is clear and easily understood by anyone who can read, referencing Section 22, Subsection 12 of the Tax Administration Bill, which requires a list of the location of derivation when filing returns.
He pointed out that Lagos will bear the brunt when the bill is enacted due to the current headquarters effect, where VAT is primarily attributed to Lagos because most companies have their main offices there.

Currently, payments and returns are processed through Lagos, but this will change when the FIRS conducts its analysis.

He said, “If a person imports goods into Nigeria through Lagos Port but the goods are to be consumed in Kano, the VAT will be attributed to Kano, not Lagos.”

Folorunsho also provided the example of telecommunications companies like MTN, which can file their returns by detailing the amount of calls made per state and location.

Additionally, he dismissed claims of a Muslim-Christian divide in the taxation of families and communities regarding inheritance tax, clarifying that there is nothing in the bill related to inheritance tax.

“Someone was telling me today when it comes to the bill, they are trying to bring in Muslim-Christian dichotomy in terms of the taxation of families and communities that has to do with inheritance tax.

“I said there’s nothing in the bill about inheritance tax, which was repealed in Nigeria in 1996 by the abolition of the capital transfer tax,” Folorunsho stated.