Nigeria’s Minister of Finance, Wale Edun, has dismissed rumours that the federal government has increased the value-added tax (VAT) rate to 10%.
In a press statement released on Monday, Edun clarified that the VAT rate remains at 7.5%, as stipulated by the country’s tax laws.
“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,” Edun said. He assured that “neither the Federal Government nor any of its agencies will act contrary to what our laws stipulate.”
Edun explained that the tax system stands on a tripod, which includes tax policy, tax laws, and tax administration. “All three elements must work together to create a sound system that gives vitality to the government’s fiscal position,” he said.
The minister emphasised that the government’s focus is to utilise fiscal policy to promote sustainable economic growth, alleviate poverty, and foster 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,” Edun added. “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 also noted, “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.”
