Increase VAT To 10%- Finance Minister, Ahmed Urges Incoming Administration
The Minister of Finance, Budget and National Planning, Mrs. Zainab Ahmed, has encouraged the incoming administration to increase the Value Added Tax (VAT) from the current 7.5 per cent to 10 percent, stating it would stimulate the country’s economic growth.
The minister, during a courtesy visit to the headquarters of VON in Abuja said: “VAT was one of the ways to increase revenue and we still have to increase VAT because at 7.5 per cent, Nigeria has the lowest VAT rate in the world, not in Africa, in the world. In Sub-Saharan Africa, the Africa average is 18 per cent, when you increase your VAT, your Gross Domestic Product (GDP) will grow.”
Mrs. Ahmed noted that the government had used the finance bills to block leakages, strengthen the Federal Inland Revenue Service (FIRS) and the Nigeria Customs Service, adding that the government has also done automation of the two institutions through the process.
Ahmed also disclosed that the federal government would remove the controversial petrol subsidy before the end of President Muhammadu Buhari’s tenure on May 29, 2023.
She attributed the delay in removal of the subsidy, as provided for in the Petroleum Industry Act (PIA) 2021, to the 2023 general election and the forthcoming national population census.
On the contrary, the federal government, on Wednesday, disclosed that nothing has been reached on how to alleviate the effect of the proposed fuel subsidy removal on the citizens.
However, the minister, maintained that the subsidy cost per litre of petrol ranged between N350 to N400, and that Nigeria spends about N250 billion monthly on subsidy.
Adding that, although, the purpose of the subsidy is to serve, its high cost was adding to government’s deficit.
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