States banning sale of alcohol shouldn’t get VAT on beer, says ex-minister

Isaac Adewole, a former minister of health, has called for fiscal federalism that allows states to receive funds in accordance with what they generate.

Fiscal federalism is how the federal, state, and local governments share funding and other administrative responsibilities within a federal system.

Adewole spoke on Friday on Inside Sources with Laolu Akande, a socio-political programme on Channels Television.

The former minister said any state that prohibits the sale of alcoholic drinks should not get out of the value-added tax (VAT) on such products from the federation account.

“I am an apostle of fiscal and physical federalism,” Adewole said.

“We need to look at how we share the resources of this country. If you have a law that prevents you from selling alcohol, that law should also prevent you from sharing money from alcohol.

“We should be honest with ourselves. States that prohibit the sale of alcohol should not share the VAT from alcohol. Straight forward.

Adewole, who was a former vice chancellor of the University of Ibadan (UI), backed President Bola Tinubu’s call for restructuring and resource control by sub-nationals.

He urged governors to allow the local government councils to function independently.

“Then we should also ask each state what they are bringing to the table. A situation where states only share money from oil is absurd, and that is why we are where we are today because the other states are not bringing anything to the table,” he added.

“What is happening to our gold, bitumen, and lithium? The resources from all of these, where are they? The only thing we know is oil money.”