Taiwo Oyedele, Chairman of the Presidential Fiscal Policy and Tax Reforms Committee, has revealed that MTN Nigeria contributes over N200 billion in Value Added Tax (VAT) each month, making it the largest contributor to the nation’s VAT pool.
Oyedele shared this information recently while speaking as a panellist during Channels Television’s Town Hall on Tax Reforms. He highlighted issues with the current VAT distribution system and the ongoing reforms designed to address them.
The expert noted that while MTN’s headquarters is in Lagos, the VAT it pays, which amounts to over N200bn monthly, is credited entirely to Lagos State, despite the fact that its services are used across Nigeria. “MTN is the biggest VAT contributor in Nigeria, and their gap with the second largest contributor is vast,” Oyedele said. “Yet, all the VAT is allocated to Lagos, even though MTN’s services are used nationwide.”
The proposed reforms aim to distribute VAT revenues more fairly, based on actual consumption rather than the location of the company’s headquarters. Oyedele presented a model showing how this adjustment would work, suggesting that under the new system, Lagos’s share would drop to 20%, while other states would receive a fairer share based on consumption.
“This ensures states where VAT is generated receive their rightful share,” he explained. “While Lagos’s share will reduce slightly, other states will benefit more.”
The reform bill, aimed at addressing long-standing issues in Nigeria’s fiscal policies, focuses on improving revenue redistribution, fixing inefficiencies, and promoting fairness in the tax system. Although the proposal has generated debate, with some critics voicing concerns, Oyedele defended the reforms, asserting that the current system is flawed. “If the system is wrong, how can Lagos oppose our efforts to fix it?” he argued.
