The federal government has clarified that there has been no increase in the country’s value-added tax (VAT) collection from the current 7.5 per cent to 10 per cent.
Minister of finance and coordinating minister of the economy, Wale Edun, made this known in a statement on Monday.
Chairman of the presidential committee on fiscal policy and tax reforms, Taiwo Oyedele, recently said his committee had proposed an increase in VAT rate from 7.5 per cent to 10 per cent.
However, Edun clarified that the current VAT rate, as stipulated in the country’s tax laws, remains at 7.5 per cent.
“The current VAT rate is 7.5% and this is what 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 statement read.
Edun said the tax system stands on a tripod which includes tax policy, tax laws, and tax administration and that all three elements must work together to create a sound system that gives vitality to the government’s fiscal position.
He also said the government’s focus is to utilise fiscal policy in ways that promote sustainable economic growth, alleviate poverty, and promote a thriving business environment.
“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,” the minister added.
