Arewa Economic Forum Advocates for Simplified Tax System
By Patience Ikpeme
The Arewa Economic Forum has joined calls from Northern interest groups to revisit the proposed Value Added Tax (VAT) system, advocating for its replacement with a more straightforward sales tax model.
The Chairman of the Forum, Ibrahim Shehu Dandakata, made this suggestion during a press briefing in Abuja on Friday.
Dandakata called for a “genuine consumption tax paid at the point of sale,” which he believes would streamline the tax collection process and broaden the government’s tax base. He described the current VAT model as “a multi-layered tax structure,” which he claims complicates tax collection, ultimately leading to increased costs for consumers.
“Under the current VAT regime, each transaction is subject to VAT, creating a burden at every point in the supply chain,” Dandakata stated. “This multilayered approach translates costs to end users, making goods and services more expensive.”
He further pointed out the government’s struggle with tax collection, citing inadequate infrastructure and facilities. “If you can’t collect, how do you reimburse a producer or distributor? A simplified sales tax collected at the point of sale could effectively widen the tax net,” he added.
The Forum also discussed urgent energy concerns in Northern Nigeria, stressing that improved energy security is vital for economic growth. Dandakata reiterated calls for the federal government to establish one of its proposed 100,000 barrels per day refineries in Kolmani, Bauchi State, arguing that this initiative would significantly lower refining and transportation costs while catering to the region’s demands.
He described the Kolmani Integrated Development Project as a promising investment opportunity, boasting an expected $3 billion in Foreign Direct Investment (FDI). This project aims to include a refinery, gas processing plant, power plant, and fertilizer plant, which collectively could reshape the economic landscape of the region.
On security issues, the Arewa Economic Forum commended the federal government and security agencies for their ongoing efforts to combat banditry in Northern Nigeria. However, Dandakata urged a more focused approach to address the escalating threats of banditry, terrorism, and organized crime, which have led to infrastructure vandalism and the abandonment of farmland in many communities.
“Counter-insurgency efforts are critical to stabilizing our region and the nation, particularly concerning agriculture, commerce, and mining,” Dandakata said. “It is imperative that government agencies expedite their efforts to create a safer environment, connecting the dots between food inflation and insecurity.”
