Nigeria plans to double the value-added tax rate to 10 per cent this year to help shore up government revenue eroded by the declining price of oil, the country’s main export, the Federal Inland Revenue Service said.
“The plan is to increase to 10 percent this year, but we have to consult first with relevant stakeholders,” Sunday Ogungbesan, Acting Executive Chairman of the FIRS, told reporters.
Nigeria depends on crude exports for about 70 per cent of government revenue and more than 90 percent of foreign exchange. The price of Brent crude has dropped by more than half since peaking in June last year, undermining President Muhammadu Buhari’s ability to deliver on his election promises since he took office in May.
FIRS will put more effort in meeting targets after its collection of 1.97 trillion naira ($9.9 billion) in revenue in the first half fell short of a goal of 2.29 trillion naira, Ogungbesan said.
“If we achieve our revenue targets, to a great extent government deficits will be reduced,” he said. “Our plan is to bring every business into the tax net, this economy can survive outside oil,” he noted. Click to signup for FREE news updates, latest information and hottest gists everyday
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Mr President, this is not a dividend of democracy..
ReplyDeleteA VAT is a national sales tax. It is a tax on the transfer of goods and services that ultimately is borne by the consumer. If it us increased, it would increase the cost of just everything. Such a move will be hugely regressive, falling heavily on the poor.
The argument on VAT aiding the government to collect more from the rich as they are the highest consumers does not add up because the poor ends up consuming far less thereby widening the gap between lower class and upper-middle class.
Mr President, people are loosing there jobs since you came to power..no contracts to keep people in their jobs..no new jobs are being created..there is apprehension in the land following the manner in which you are running the affairs of the country..if you continue to chase shadows leaving out the people, you will not be counted amongst the Mandela class.
This just not the time to burden Nigerians with additional taxation over the existing rates. Apart from the controversial oil subsidy saga which has stressed low income earners,unreasonable taxes at the local and state levels under the guise of LGR have been imposed. Import duties on some essential commodities have been escalated to 100%. Energy merchant scrape consumers unscrupulously unabated; you could pay heavily for electricity not consumed or provided. Unfortunately these monies go to where they are embezzled. My humble plea is let us see improvement before imposing further taxes.
ReplyDeleteIt's a good idea only if it doesn't get embezzled.
ReplyDelete