Taiwo Oyedele, Chairman of the Presidential Tax Reform Committee, has warned that permitting state governments to collect Value Added Tax (VAT) could lead to chaos.

In a recent interview with Maupe Ogun-Yusuf on Channels Television’s Hard Copy, Oyedele highlighted that a similar attempt to introduce a sales tax in the 1980s failed to generate significant revenue for subnational governments.

He argued that state-level VAT collection would reduce revenue and create challenges for businesses across the country. Oyedele pointed out that the omission of VAT collection as a federal responsibility in the 1999 Constitution was an oversight, given its importance as a revenue source at the time.

Oyedele explained, “By 1999, VAT had been implemented for about five years and was becoming a top revenue tax. Its absence in the 1999 Constitution, which replicated the 1979 Constitution, was a significant oversight. This omission has led to legal interpretations that VAT is a residual matter belonging to subnational governments. If the Supreme Court rules favour state collection, it will result in reduced revenue, business challenges, and economic regression.”

Watch the full interview: