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VAT Bill: Lagos Chairmen Demands 50-50 Sharing Formula, Kick Against 75-25 Proposed By The State



The Conference of 57 Local Governments and Local Council Development Areas (LCDAs) in Lagos has requested equal sharing formula with the state in the proposed value-added tax (VAT) bill now before the Lagos House of Assembly.

The secretary of the Conference 57 and chairman of Odi-Olowo/Ojuwoye LCDA, Abdulrasak Ajala, made the request at a one-day public hearing on the bill organised by the Lagos Assembly on Wednesday.

The parliament is considering a tax bill titled ‘A Bill for a Law to impose and charge Value Added Tax (VAT) on certain foods and services, provided for the administration of the tax and for related matters’, following Rivers’ example.

Mr Ajala explained that for the councils to pursue meaningful development, they required a better sharing formula for its members in the proposed VAT law.

The conference 57 secretary demanded a 50-50 sharing formula, contrary to the 75-25 proposed in the bill in favour of the state government.

Being the closest to the grassroots, Mr Ajala explained that the councils, which also host companies, should benefit from a better share than the 25 per cent in the bill.

The council chairman commended the legislators for the bill, as well as the synergy between the executive and the legislature.

“On the distribution of revenue, you will agree with me value-added tax is on consumption and production, and all these economic activities are domiciled in our respective communities. In addition, local governments, being the closest to the grassroots, need more revenues given the enormity of the responsibilities the Constitution confers on us,” he noted. “Hence, the 25 per cent in the bill is grossly inadequate for local governments to execute all the promises we made to our people; and of course all our electoral promises.” he said.


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