Finance Minister Wale Edun reacts to Atiku’s claims on VAT

The Minister of Finance and Coordinating Minister of the Economy, Wale Edun, on Monday, debunked reports that the rate for Value-Added Tax (VAT) has been adjusted to 10 percent from 7.5 percent.

The minister, in a statement signed by him, said VAT rate as contained in relevant tax laws and chargeable on goods and services remains 7.5 percent.

“The current VAT rate is 7.5 percent and this is what 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.

“The tax system stands on a tripod, namely tax policy, tax laws and tax administration. All the three must combine well to give us a sound system that gives vitality to the fiscal position of government.

“Our focus as a government is to use fiscal policy in a manner that promotes and enhances strong and sustainable economic growth, reduces poverty as well as makes businesses to flourish.

“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 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 congenial environment for businesses to thrive.

“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.

“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,” Mr Edun said.

The finance minister was responding to claims, including by former Vice President Atiku Abubakar, that the President Bola Tinubu’s government had concluded plans to raise VAT.

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In a statement he circulated on Sunday, Atiku had claimed that “President Bola Tinubu, alongside his coterie of advisers, has resolved to raise the VAT rate from 7.5% to 10%, even as the NNPCL has announced a soaring PMS price increase at the pump.

“The increase in VAT is set to become the blazing inferno that will consume the very essence of our people.”

The former vice president further claimed that the “move unveils a new era of regressive and punitive policies, and its impact is destined to deepen the domestic cost-of-living crisis and exacerbate Nigeria’s already fragile economic growth.”

But the finance minister has now clarified that the claims by the former vice president and other critics are false and unwarranted.