The Minister of Finance and Coordinating Minister of the Economy, Wale Edun, has dismissed reports making the rounds that the rate for Value-Added Tax (VAT) has been raised from 7.5% to 10%.
It would be recalled that the Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, Taiwo Oyedele, had recommended an upward review of the Value Added Tax (VAT) from the present 7.5% to 10%.
Oyedele made this known while speaking on Channels TV last week. A development that has generated widespread condemnation by many Nigerians including former VP Atiku Abubakar.
Reacting to this in a statement signed and released on Sunday, September 8, Edun explained that VAT rate as contained in relevant tax laws and chargeable on goods and services remains at 7.5%.
“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 the 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.
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.” The statement added.
