Economy & Politics
September 20, 2021
Economy and Politics: Why A State-Controlled VAT System Will Not Be Effective for Nigeria
This edition of the "Economy and Politics" features Mr. Yomi Olugbenro the West Africa Tax Leader, Deloitte as he speaks on "VAT & The Pathway to Fiscal Stability in Nigeria"

According to him a Value Added Tax system controlled by State governments, will not be effective for the Nigerian economy, as it will lead to the slow growth of Micro, Small, and Medium Enterprises, MSMEs. Speaking further he believed it is not going to be potentially advantageous to states in the short-term, because it will not be easy for them to match the VAT collection structure that the Federal Inland Revenue Service, FIRS has established in 3 decades. 

He argued that a decentralized VAT system is not good for Nigeria's economy. It will have an adverse impact on businesses because of the cost implications and potential trade disputes. 

Olugbenro called for a constitutional review on the VAT system, which is not captured in the exclusive or concurrent list. He decried the fact that there was so much uncertainty which is not good for Nigeria's tax system, especially in the area of attracting investments.



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