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Message: [QUOTE="Munyaradzi Mafaro, post: 80414, member: 636"] States are getting stiffed on taxes meant for them. The Nigerian Extractive Industries Transparency Initiative, or NEITI, dropped a policy brief saying state and local government internally generated revenue is pitiful. They blame weak local economies, but also point a big finger at federal tax collection. NEITI says taxes like VAT come from economic activity in the states, but the cash goes to the federal pot first. Under a new national tax plan, a National Revenue Service would collect these taxes for the states. The watchdog argues this setup still shortchanges sub-national governments. NEITI wants concrete fixes to make the system fair. Their first demand is automatic remittance of a set percentage of certain taxes back to states and LGAs. This includes money from VAT, payroll taxes, and mining royalties. They say this needs constitutional backing and clear publication of when payments go out. The group also pushes for stronger state revenue authorities. Even if the collection is federal, states should keep the power to administer local taxes and enforce rules. They propose a Joint Tax Governance Council with members from national and state tax bodies, local governments, and civil society to oversee policy and settle disputes. Transparency is a major issue for NEITI. They insist on detailed public reporting. Every penny collected by the national service on behalf of states and LGAs must be reported individually. Monthly remittance reports should be published for everyone to see. On extractive industries like mining, NEITI says royalties should be shared revenue. Host communities should get a guaranteed cut based on derivation principles. Finally, the brief calls for building up state tax capacity. Centralizing collection should not weaken local systems. NEITI wants technical help and data sharing to actually improve state revenue administration. [/QUOTE]

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