The Federal Executive Council (FEC), presided over by President Muhammadu Buhari has approved a two per cent increase in value added tax (VAT) rate from 5% to 7.2%.
Minister of Finance, Budget and National Planning, Zainab Ahmed, disclosed this while speaking to State House Correspondents at the end of the meeting on Wednesday.
Ahmed, however, said the implementation will not start until the approval by the National Assembly after the VAT Act is amended.
She said: “We will begin consultations and consultations will be at various levels in the country. So it includes consultations with the states, with the local governments, with the parliament as well as with the Nigerian public. For the VAT increase to take effect, there has to be an amendment to the VAT Act.”
The council directed immediate consultations with states, local governments and other relevant stakeholders before it will take effect in 2020.
