VAT remains 7.5%, no plans to make it 10%, says Edun

Wale Edun, Nigeria’s minister of finance and coordinating minister of the economy has refuted claims that the government reviewed the country’s Valued Added Tax (VAT) to 10 percent.

In a statement issued by the minister on Monday, he stated that VAT still remains 7.5 percent contrary to varying opinions on social media.

“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 said.

“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 comes on the backdrop of reports revealing that the President Bola Tinubu administration is planning to raise VAT to 10 percent, thereby compounding the woes of many Nigerians who are grappling with rising prices of food and energy.

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The finance minister said Nigeria’s tax system stands on a tripod, namely tax policy, tax laws and tax administration noting that all the three must combine well to give 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,” Edun said.

The coordinating minister of the economy said the reports making the rounds on a purported upward review of VAT “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 said.

He explained that the Federal Government, as part of efforts to bring relief to Nigerians and businesses, had recently ordered the stoppage of import duties, tariffs and taxes on rice, wheat, beans and other food items.

Wasiu Alli

Wasiu Alli is a business, economics cum data journalist with strong expertise covering macro trends, capital markets, government policies, corporate earnings and comparative economics analysis. Alli turns raw data into trends that not only tells compelling stories but nudges investors to make valued and informed decisions. He’s an alumnus of Lagos State University and trained at Lagos Business School. He formerly heads the Companies and Markets desk at BusinessDay where he writes and supervises the production of well researched articles on earnings updates, corporate sectoral comparisons, market intelligence as well as interviews with C-suite executives.