By Abiola Olawale
The atmosphere on Tuesday in the House of Representatives was charged with tension during debates on the tax reform bills proposed by President Bola Ahmed Tinubu.
The charged situation arose after Hon. Akin Rotimi, a lawmaker representing Ekiti North 1 (Ikole/Oye) Federal Constituency of Ekiti State at the House of Representatives, initiated a motion on the highly contentious tax reform legislation that has been a hot topic of debate in recent months.
Moving his motion, Rotimi said the Green Chamber should adopt the tax reforms. This declaration ignited an uproar among his fellow lawmakers, who expressed their dissatisfaction vocally and passionately.
In the wake of the turmoil, Hon. Ghali Tijani took the floor to raise a serious motion alleging a breach of privilege.
He called for the resignation of Rotimi from his role as spokesperson for the House, arguing that it was inappropriate for him to take a stance on a bill that was yet to be thoroughly debated within the legislative body.
The Deputy Speaker acknowledged Tijani’s motion, noting that it would be formally recorded, and reassured members that a comprehensive investigation into the incident would be undertaken by the House.
The New Diplomat reports that the tax reform bills introduced by the administration of Tinubu have ignited widespread controversy across various sectors of the economy and the political arena.
The new tax bills under consideration in the National Assembly propose adopting a derivation principle in the allocation of VAT revenues between the federal government and sub-national entities.
These proposals have sparked controversy, with northern elites openly rejecting them, arguing that the changes may not favour the North.
Under the current Section 40 of the VAT Act, VAT revenue is allocated as follows: 15% to the Federal Government, 50% to the States and Federal Capital Territory (FCT), and 35% to Local Governments. The allocation to states and local governments incorporates a derivation principle of at least 20%.
Although not explicitly detailed in the VAT Act, other factors influencing the distribution include 50% based on equality and 30% based on population.
