Minister of Finance and Coordinating Minister of the Economy, Mr. Wale Edun, on Monday dismissed circulating reports that the Value-Added Tax (VAT) rate has been increased from 7.5% to 10%.
It could be recalled that former vice president, Atiku Abubukar berated the federal government over its proposed hike in Value Added Tax (VAT) from 7.5 per cent to 10 per cent, describing the move as the latest inferno that would consume Nigerians.
The Peoples Democratic Party (PDP) presidential candidate in the 2023 general elections over the weekend was apparently reacting to the disclosure by the Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, Taiwo Oyedele that his committee had proposed a 2.5 per cent increase in VAT, from 7.5 per cent to 10 per cent by 2025.
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In a statement signed by Edun, the Minister confirmed that the VAT rate remains at 7.5%, as stipulated by current tax laws.
“The current VAT rate is 7.5% and this is what the government is charging on a spectrum of goods and services to which the tax is applicable. Therefore, neither the Federal Government nor any of its agencies will act contrary to what our laws stipulate.
“The tax system stands on a tripod, namely tax policy, tax laws and tax administration. All three must combine well to give us a sound system that gives vitality to the fiscal position of the government.
“Our focus as a government is to use fiscal policy in a manner that promotes and enhances strong and sustainable economic growth, reduces poverty as well as makes businesses flourish.
“The imputation in some media reports on the issue of VAT and the opinion articles that have sprouted from them seem to wrongly convey the impression that the government is out to make life difficult for Nigerians. That is not correct. If anything, the Federal Government has, through its policies, demonstrated that it is committed to creating a congenial environment for businesses to thrive.
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“In fact, it is on record that the Federal Government, as part of efforts to bring relief to Nigerians and businesses, recently ordered the stoppage of import duties, tariffs and taxes on rice, wheat, beans and other food items.
“For emphasis, as of today, VAT remains 7.5% and that is what will be charged on all the goods and services that are VAT-able,” Edun said.
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