Former Governor of Anambra State, Peter Obi, has urged state governments to develop their revenue generation capacity.
The Federal Inland Revenue Service (FIRS) and some state governments are presently involved in a legal dispute over VAT collection.
Rivers and Lagos state governments are leading the charge for states to collect VAT, a development that some states are not comfortable with.
Peter Obi who was a guest on the Channels Television programme, Politics Today s on Sunday, expressed optimism that fiscal federalism will make Nigeria more productive.
He stated that the conversation on fiscal federalism in Nigeria should be focused on revenue generation, rather than revenue sharing.
Fiscal federalism is the division of revenue collection and expenditure responsibilities among different tiers of government.
In Nigeria, states collect personal income tax (PIT), withholding tax (WHT) on rent while FG collects company income tax (WHT), amongst others.
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“My stand on the issue of fiscal federalism hasn’t changed because it will make the country productive. Whenever such controversies come up, what bothers me is that the country always concentrates on sharing, nobody is talking about how to generate income,” Obi said.
“Nobody is talking about production. The country is not productive, that is why we are preoccupied with sharing.
“If we are productive, it will be very easy for Nigeria to grow, be able to create jobs and do what others are doing.
“Every part of Nigeria has the potential to grow and compete, but we are not doing that.”
Citing reports that Anambra has become an oil-producing state, the former governor stated that the country needs to evolve from seeing resource control from an angle of natural resources to investing in its human capital.
“Oil is a dead asset. With the plans we had when I was in office, if it was followed by the next administration, Anambra would have generated way more than Nigeria generates from oil,” the former governor said.
“Because when you talk about oil, how much are you (Nigeria) getting from oil? $18 billion, that’s all we are getting from oil.”