VAT remains 7.5% – Finance minister
Minister of Finance and Coordinating Minister of the Economy, Wale Edun, on Monday, dismissed reports making the rounds that the Value-Added Tax (VAT) rate has been increased from 7.5 per cent to 10 per cent. Edun, in a statement personally signed by him, clarified that the VAT rate remains unchanged at 7.5 per cent, as […]
Minister of Finance and Coordinating Minister of the Economy, Wale Edun, on Monday, dismissed reports making the rounds that the Value-Added Tax (VAT) rate has been increased from 7.5 per cent to 10 per cent.
Edun, in a statement personally signed by him, clarified that the VAT rate remains unchanged at 7.5 per cent, as stipulated in the nation’s tax laws.
He explained the importance of maintaining a balanced tax system, emphasising that Nigeria’s tax framework is built on three key pillars- tax policy, tax laws, and tax administration.
While addressing concerns over government actions perceived as burdensome, Edun reassured Nigerians that fiscal policies are designed to promote sustainable economic growth and alleviate poverty, not to hinder them.
For clarity, Edun reiterated that VAT remains at 7.5 per cent and will continue to be applied to all VAT-eligible goods and services.
The statement said: “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,” Edun says.
“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 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 to 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 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.”