The minister of Finance and Coordinating Minister of the Economy, Wale Edun, has refuted claims that the government is planning to increase the Value-Added Tax (VAT) rate.
Recent reports suggested that the VAT rate would rise from 5% to 10%, but the minister has clarified that the current rate remains unchanged.
In a statement on Monday, Edun emphasized that the VAT rate is 7.5% and will remain so in accordance with the country’s tax laws. “The current VAT rate is 7.5%, and this is what the government charges on applicable goods and services. Neither the Federal Government nor any of its agencies will deviate from what the law prescribes,” he affirmed.
Edun also stressed the need for a balanced tax system, built on three key pillars: tax policy, tax laws, and tax administration. He noted that these elements must work together to maintain fiscal stability in the country. “These three elements must work in harmony to sustain the government’s fiscal stability,” he said.
Addressing concerns about potential additional financial pressures on Nigerians, Edun reassured citizens that the government’s fiscal policies are designed to foster economic growth and reduce poverty, not to impose hardships. “Our goal is to use fiscal policy to enhance sustainable economic growth, reduce poverty, and create a business-friendly environment,” he stated.
He dismissed media reports suggesting the government is worsening the financial challenges facing Nigerians, labeling such claims as inaccurate. “These reports wrongly imply that the government is making life more difficult for Nigerians, which is not the case. In fact, the government is focused on fostering a conducive environment for businesses to flourish,” he noted.
As part of efforts to ease economic pressures, Edun pointed to the removal of import duties on key food items such as rice, wheat, and beans, which he described as a significant step to alleviate the cost of essential goods.
“For emphasis, VAT remains at 7.5%, and that is what will be charged on all VAT-able goods and services,” he concluded.
