Will Tax Reform Bills Halt Salary Payments? Governor Zulum Weighs In
Governor Babagana Zulum of Borno State has expressed concerns over the potential impact of President Tinubu’s proposed tax reform bills, warning that they could hinder the ability of states to pay salaries.
Zulum, along with other northern governors, opposes the reforms, particularly the Value Added Tax (VAT) sharing formula, which shifts a significant portion of revenue allocation to states based on derivation principles.
The northern governors argue this approach could disadvantage states with less economic activity or fewer corporate headquarters.
The proposed reforms are part of a broader set of fiscal bills introduced by President Tinubu to streamline tax administration and enhance efficiency.
However, critics, including Zulum, fear the measures may strain state finances and worsen economic challenges, particularly in the northern region.
The National Economic Council (NEC) has also called for the withdrawal of these bills to allow for wider consultations.