The Federal Government has confirmed plans to raise the Value-Added Tax, (VAT) rate.
Minister of Finance and Coordinating Minister of the Economy, Wale Edun, disclosed this while speaking at an investor meeting during the ongoing IMF/World Bank Annual meetings in Washington DC, USA.
According to the minister, the proposed VAT increase, currently under consideration by the National Assembly, will be applied gradually and will primarily affect luxury items.
He said essential items consumed by poorer and vulnerable Nigerians would remain exempt from VAT or attract a zero rate. Edun added list of essential goods exempted from VAT will be made available to the public in due course.
He said: In terms of VAT, President Bola Tinubus commitment is that while implementing difficult and wide-ranging but necessary reforms, the poorest and most vulnerable will be protected.
So, the Bills going through the National Assembly in terms of VAT will raise VAT for the wealthy on luxury goods, while at the same time exempting or applying a zero rate to essentials that the poor and average citizens purchase.
Recall that in September, Chairman, Presidential Fiscal Policy and Tax Reforms Committee, Taiwo Oyedele, said the committee was proposing a law to the National Assembly to increase VAT rate from the current 7.5% to 10%.
