By Bayero Ade
Lagos State Governor, Babajide Sanwo-Olu, has expressed support for the federal government’s tax reform agenda, stating that the state’s position is “extremely comfortable” despite concerns about potential losses.
In an interview with the News Agency of Nigeria (NAN) at the Africa Investment Forum, Market Days 2024, in Rabat, Morocco, Sanwo-Olu encouraged citizens to thoroughly review the reform’s provisions to better understand its objectives. He clarified that while Lagos might lose out in certain areas, the state would ultimately benefit by playing a more prominent role in the broader governance structure.
The governor referred to the reform as “wonderful,” stressing that Nigeria’s tax-to-GDP ratio is among the lowest globally, and it is essential for the country to pursue changes. He reassured that the reform’s goal is not to harm anyone, but rather to improve the situation for all Nigerians.
“Some people are uncomfortable with the reform, but they fail to acknowledge that no change comes without some disruption,” Sanwo-Olu remarked. “You cannot make progress without implementing reforms. I encourage people to read the provisions carefully to understand the larger vision.”
He further dismissed the claim that Lagos would be the major beneficiary of the reform, stating, “Lagos will actually lose in some areas. However, on a broader scale, the reform aims to create a better governance structure, and all of us will be able to contribute more effectively.”
Sanwo-Olu emphasized that the reform requires individuals to work harder to realize its full benefits, noting that the changes could unlock new opportunities for both states and non-governmental actors.
“While Lagos might lose in certain aspects, we also have a chance to take on a more significant role,” he explained. “The tax-to-GDP ratio in Nigeria is one of the lowest in the world. This reform is crucial to improving the country’s financial system and governance.”
The governor reassured that the reform’s aim is to improve the lives of all Nigerians, not just a select few.
The proposed tax reform bills, championed by President Bola Tinubu, have sparked controversy, particularly among governors and traditional rulers in Northern Nigeria, who argue that the measures do not align with their regional interests.
Key provisions of the reform include an increase in the Value Added Tax (VAT) from 7.5% to 10% by 2025, a 27.5% corporate tax rate, a 4% development levy on companies, and a 5% excise tax on lottery and gaming income.
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