A former presidential candidate and chieftain of ruling All Progressives Congress (APC), Mr. Gbenga Olawepo-Hashim, has counselled state governors on controversial Value Added Tax (VAT).
He maintained that the current controversy and debate on the VAT should not be reduced to ethnic propaganda or war-like debate between the North and the South.
Olawepo-Hashim explained that the issues and comments around the matter should be more of “economic history and analysing economic data instead of being turned to a South versus North thing.”
According to him, “whatever formula that will be worked out in future must be with the objective of bringing benefits to all Nigerians in all States and challenging States to make industrialization their priority as well as agricultural production and processing.”
He stressed that while the current controversy over who should collect VAT between States and Federal Government remains the latest mud thrown into Nigeria’s political water in an attempt to muddle the water more, he argued that what the country needs presently is a VAT collection and distribution system that will benefit all.
He added that those who have “managed the information about the VAT wars have created the impression that the present distribution benefits the Northern States more than the Southern States. They try to make it look like the VAT is part of the “hegemonic domination” of the North. Many commentators hardly look at the data before they hit their keyboards online. Many swallowed hook line and sinker very obvious lies.”
Citing data published in a national newspaper, Olawepo-Hashim argued that apart from Lagos, Rivers and Abuja who benefit from the fact that they host the headquarters of major economic, political and oil related institutions, most States apart from Oyo State are doing badly in VAT generation and a lot of Southern States are woeful.
“Most States, whether they are in the North or South are doing badly in production of goods and services except for Lagos, Rivers, Oyo, Kano and Kaduna States. The present centrally collected VAT which is then distributed subsidises everybody,” he said.
He maintained that in comparison to Eastern States, States such as Kaduna, Kano and Katsina are doing better than Abia, Anambra, Imo, and Enugu, adding that based on available data in the past eight months, total VAT generated in Abia was N2.290b, Anambra -N5.938b, Imo -N1.941 compared to Kaduna -N18.262b and Kano -N24.492b.
“Conversely, when it came to distribution, Nnamdi Kanu’s Abia State got N20.020b for generating N2billion, yet he wants to leave Nigeria that is “oppressing” him. Abia got 10 times what it contributed whereas Kaduna and Kano did not get as much as twice what they contributed. Lagos, Rivers and Oyo got lower.
“Interestingly, Ebonyi, where the Governor is more supportive of national integration, is infact the State that generated more VAT in the South East, possibly owing to the activities of mining related industries,” Olawepo-Hashim noted.
He added that “a major fact showing in the data is also that regions who have been fortunate to benefit from the industrialization policies of fore-sighted leaders during the period of independence tend to do well today in VAT collection and Internally Generated Revenue (IGR).
“Such States as Oyo, Ogun, Lagos that benefitted from Chief Obafemi Awolowo’s industrialization policy between 1955 and 1960 stand out. Likewise, even though some of the industries are now moribund, but we see evident success of the industrialization policies of the NPC government in the period of limited self-government and country’s Independence in States like Kaduna and Kano, with some spillover effects in Jigawa and Katsina.”
He argued that despite the insurgency challenges, Yobe generated more VAT than Enugu and Anambra respectively, adding that “as a matter of fact Kano’s VAT generation is bigger than that of all the 5 Eastern States put together.”