The Minister of Finance and Coordinating Minister of the Economy, Mr Wale Edun, on Monday, dismissed report alleging that the rate for Value-Added Tax (VAT) has been upwardly adjusted to 10% from 7.5%.
Recall that there have been reactions from different quarters in response to the alleged VAT increment. Former Vice President, Atiku Abubakar had during the weekend made a strong comment on the alleged VAT increment.
But the Minister, in a statement he personally signed affirmed that VAT rate as contained in relevant tax laws and chargeable on goods and services remains 7.5%. He stressed further that no one can act contrary to the law by increasing the VAT.
The statement said, “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. Therefore, neither the Federal Government nor any of its agencies will act contrary to what our laws stipulate.
“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 that gives vitality to the fiscal position of government.”
Dismissing opinions in several quarters that the government was deliberately trying to create hardship for the people, the minister said, “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 to flourish.
“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. 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 it was in an effort to reduce hardship across the country that it ordered the stoppage of import duties and tariffs on some major food items.
“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.
“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,” Edun said.