Use Derivatives Principle for VAT sharing, Abiodun tells FIRS - THE BUSINESS PACKAGE


Tuesday, February 18, 2020

Use Derivatives Principle for VAT sharing, Abiodun tells FIRS

Ogun State Government has called for more share from the fund realised from the Value Added Tax (VAT), to reflects its status as the host to largest industries in the country

The State Governor, Prince Dapo Abiodun made the call when he received the management staff of the Federal Inland Revenue Service, led by its Chairman, Mr. Mohammed Nami, on a courtesy call on him at his office at Oke-Mosan, Abeokuta.

Governor Abiodun who expressed disappointment on the money that accrued to the State from Value Added Tax, noted that as the State with largest concentration of industries, the principles of derivation should be used in the distribution of VAT.

"There is no meaningful industry that is not here, however, when VAT are computed, what we see is different. Because these industries have their headquarters in Lagos, Lagos gets the benefit of VAT. I believe we should revisit this and we should try and find a way to be more equitable by compensating us.

"I believe that most of the factories that are here have distributors and when they take delivery of their goods here in Ogun State, VAT are paid at the point of sales and further down the line. We will like that the principles of attribution or derivation be used in the distribution of VAT", the Governor pleaded.

He said the State with the largest deposit of solid minerals was blessed with silica, while one third of the entire State has limestone deposit, saying that this has enable the State generate the highest of revenue to the coffers of the Federal government.

Prince Abiodun solicited for a synergy between the Federal Inland Revenue Service and the Ogun State Internal Revenue Service in the exchange of information between the two agencies in the area of Corporate Tax payers and others in their various tax net.

"We are also looking for how to collaborate in the area of capacity building. We appreciate that the Federal Inland Revenue Service has lots of programmmes that are aimed at training and capacity building and we believe that we can tap into that to help our tax administrators up to the Local Government level for better performance", he said.

The Governor revealed that the State revenue service has over the last eight months of his administration, recorded the highest revenue since the creation of the agency, without recourse to land sale, saying no that the intension was to properly dimension the revenue by blocking leakages and being more effective in financial management.

He said the State Investment Promotion and Facilitation Agency to showcase all the comparative advantages in all spectral of economic activities,  the State Business Environment Council to eliminate bottlenecks, red-tape and multiple taxation as well as the State Public Private Partnership office to coordinate partnership that meet International best practices, were set up to ease doing business in the State.

No comments:

Post a Comment