Nigeria’s vice-president, Prof Yemi Osinbajo has revealed that the recent increase in value-added tax (VAT) from 5% to 7.5% remains the lowest in Africa.
Osinbajo stated this in Lafia, Nasarawa State capital, on Monday, February 10; during the launching of the national micro, small and medium enterprises clinics for viable enterprises.
According to him; “the new value-added tax which has gone up from 5% to 7.5%; many people have said it is the higher tax burden on the consumers and of course it has implications for those who are trading as well.
“But we must remember that this is the lowest VAT rate in the whole of Africa; Ghana VAT rate was 15%, they reduce it to 12.5%, ours is 7.5%.
“It is also important to mention that companies and MSME; with a low turnover of less than N25m do not have to register for VAT and as a result of this; the government has worked out a way of not creating any extra burden for small and medium-sized companies.
“In other to reduce the impact of the VAT increase on consumers, several basic items such as food, drugs and educational items are exempted from VAT; so there is no payment of VAT on food, drugs and educational items,” he said.
Speaking earlier, the state governor Abdullahi Sule, said that the project was apt and timely; considering the commitment of the state to generate wealth as well as to ensure job creation; by stimulating and supporting the private sector in the state.
“We wooed private investors into the state with a view to opening the frontiers of economic opportunities for the overall development of the country,” he said.