The Minister of Finance and Coordinating Minister of the Economy, Wale Edun, has denied reports of increase in Value Added Tax, VAT to 10 per cent. Edun maintained that the Value-Added Tax rate remains 7.5 per cent.
This was contained in a statement signed by the Minister on Monday. He clarified that the VAT rate remains unchanged at 7.5 per cent, as stipulated in the nation’s tax laws.
He 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.”
The Minister further explained the importance of maintaining a balanced tax system. He noted that Nigeria’s tax framework 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. A system that gives vitality to the fiscal position of the government,” the minister said.
Edun, however, reassured Nigerians that fiscal policies are designed to promote sustainable economic growth and alleviate poverty. And not to hinder them.
He said, “Our focus as a government is to use fiscal policy in a manner that promotes and enhances strong and sustainable economic growth. And to reduces poverty as well as makes businesses flourish.”
Edun, therefore, described as inaccurate media reports that painted the government as seeking to impose additional hardship on citizens.
He said, “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.”
The Minister, therefore, highlighted recent government initiatives enacted to ease the financial burden on citizens, particularly regarding food imports.
“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,” Edun noted.
source: PUNCH
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