Lagos, no doubt, is Nigeria’s number one state with the largest revenue. When compared to other states in Nigeria, Lagos has been able to diversify its economy and to considerably reduce its dependence on the country’s oil allocation.
With growth that’s come in the form of vital reforms in state service, such as taxation, transport services and waste management, Lagos state remains the economic hub of Nigeria twenty five years after it was replaced as the country’s political capital.
The state’s potential to generate revenue has now been boosted even further by confirmation of oil production.Yesterday, the Minister of Finance, Kemi Adeosun, stressed that more than half of Nigeria’s value added tax, VAT, comes from Lagos State alone.
While speaking at the parley between the Federal Government and Progressive Governors Forum, PGF, in Abuja, the Finance Minister said that 87 percent of Nigeria’s VAT was derived from four states and the Federal Capital Territory, FCT.
In addition, Adeosun noted also that only 13percent of Nigeria’s VAT came from 32 other states in the federation.
“There is no poor country that has a high tax compliance rate, and no rich country that has a low one,” Adeosun said.
According the minister, the current VAT collection data across Nigeria reads thus:“55% of Nigeria’s VAT was collected in Lagos State; FCT, 20%; Rivers, 6%; Kano, 5%;and Kaduna, 1%.”In addition, she expressed hopes that one day, finance commissioners will stop needing to come to Abuja monthly to share FAAC, because IGR (internally generated revenue) will be sufficient.
According a report byFinancial Nigeria 24 April, 2017, Lagos declared N436 billion annual internally generated revenue in 2016.
The report said that 420,000 Lagos residents became registered tax payers in 2016, which is a big increase when compared to 2015. Also, the report said the payment of Land Use Charge (LUC) increased in 2016, totaling to N7 billion, which is against N6 billion in 2015.
Need we give more reasons why Lagos alone generates 55% of Nigeria’s Value added Tax (VAT) income? Definitely, Lagos is not just Eko for show, it is ‘the boss’ for real.
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