JUST IN: More Burdens For Nigerians As FG Moves To Hike VAT

The Value Added Tax (VAT) may see an increase as recommended by the Presidential Committee on Fiscal Policy and Tax Reforms.

Chairman Taiwo Oyedele disclosed this during a policy exposure and impact assessment session hosted by the committee.

Addressing concerns over the potential hike, Oyedele assured that the review would not disproportionately affect low-income earners and small-scale business owners. He highlighted that essential items such as food, education, medical services, and accommodation would remain exempt from VAT.

The proposed adjustment aims to address the changing dynamics of Nigeria’s economy, where services contribute significantly. Oyedele emphasized collaboration with the private sector to ensure that businesses refrain from hiking product prices post-reform.

Additionally, the committee proposed revising the revenue-sharing formula, suggesting an increase in the share allocated to state and local governments while reducing the federal government’s portion. This adjustment, if implemented, would alter the current distribution outlined in Section 40 of the VAT Act.