The Minister of Finance, Mr. Wale Edun, has debunked reports making the rounds that Nigeria has lately experienced an increase in the Value Added Tax rate from 7.5 per cent to 10 per cent.
The minister made this known on Monday, September 9, 2024 , in a statement signed and released by him to the public, clarifying that the VAT rate remains unchanged at 7.5 per cent.
In his words : "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 stipulates".
“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,” he concluded.
The minister further explained that maintaining a balanced tax system is very essential, emphasizing that Nigeria’s tax landscape is built on three key pillars- tax policy, tax laws, and tax administration.
“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,” Edun said.
He also spoke on the government's latest initiatives to ease the financial burden on Nigerians, especially on food importation services.
“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,” the minister noted.
In his attempt to clear the air on the alleged VAT increase, Edun reaffirmed that VAT remains at 7.5 per cent and will continue to be applied to all VAT-eligible goods, commodities and services.
Edun also reassured Nigerians that fiscal policies made by Government are in their best interests, because they are specifically designed to promote sustainable economic growth and alleviate poverty.
In his statement, the minister said : "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 make businesses flourish".
The minister also condemned talks going on in the media, that the government enjoys imposing hardship on citizens, saying such reports are lies and unfounded.
“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,” he stated.
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