The Minister of Finance and Coordinating Minister of the Economy, Mr. Wale Edun, has refuted claims that the Federal Government plans to increase the Value-Added Tax (VAT) rate from 7.5 percent to 10 percent.
In a statement released on Monday and signed by Edun, the minister clarified that the VAT rate remains unchanged at 7.5 percent, as outlined in Nigeria’s tax laws.
“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,” Edun stated.
Edun emphasized the need for a balanced tax system and highlighted that Nigeria’s tax framework operates on three key components: tax policy, tax laws, and tax administration.
“The tax system stands on a tripod, namely tax policy, tax laws, and tax administration. All three must combine well to give us a sound system that supports the fiscal position of the government,” he said.
The minister also addressed concerns over fiscal policies, reassuring Nigerians that government measures are aimed at promoting sustainable economic growth and reducing poverty, rather than creating burdens.
“Our focus as a government is to use fiscal policy in a manner that promotes and enhances strong and sustainable economic growth, reduces poverty, and supports business growth,” Edun said.
Responding to media reports suggesting the government is attempting to impose additional hardships on Nigerians, Edun called such claims inaccurate and misleading.
“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 conducive environment for businesses to thrive,” he stated.
Edun also pointed to recent government initiatives aimed at easing financial pressure 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,” he noted.
For clarity, Edun reiterated that the VAT rate remains at 7.5 percent and will continue to be applied to all VAT-eligible goods and services.
“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 concluded.
