Govt to take their increased wage back - VAT increased from 5% to 7.2%

The Federal Executive Council on Wednesday approved an increase in the Value Added Tax (VAT) payable in Nigeria.

The Minister of Finance, Zainab Ahmed, announced the approval while briefing journalists after the FEC meeting presided by President Muhammadu Buhari.

Mrs Ahmed said the VAT was increased from the current 5 per cent to 7.2 per cent.

“We also reported to council and council has agreed that we start the process towards the increase of the VAT rate.

“We are proposing and council has agreed to increase the VAT rate from 5 per cent to 7.2 per cent,” she said.

Mrs Ahmed gave an increase in revenue accruable to state governments as one of the reasons for the increase.

“This is important because the federal government only retains 15 per cent of the VAT, 85 per cent is actually for the states and local government and the states need additional revenue to be able to meet the obligations of the minimum wage.”

The minister, however, said the implementation will not be immediate as there was the need to amend the current law.

https://www.premiumtimesng.com/business/351909-buhari-ministers-approve-increase-in-nigerias-vat.html