FEC Approves Increase In VAT To 7.5% From 2020, To Seek NASS Approval For Enabling Law

Proshare

Thursday, September 12, 2019  /  05:39AM / By TheAnalyst  / Header Image Credit: forthcapital.com 

 

The Federal Executive Council (FEC), presided over by President Muhammadu Buhari has approved a two per cent increase in Value Added Tax (VAT) to move it from five to seven and half percent.


The Minister of Finance, Budget and National Planning, Zainab Ahmed; made this disclosure while briefing State House Correspondents at the end of the seven-hour long FEC meeting.


Following due process, the implementation will not start until the approval by the National Assembly to whom an amendment for the VAT Act will be sent.


The council directed immediate consultations with states, local governments and other relevant stakeholders before the enactment, set to take effect in 2020.

 

Initial Reaction

 

This is a policy Proshare Analysts have argued is inevitable if the revenue gap is to shrink. The best time to however raise taxes is in an upswing cycle but we have found ourselves in the worst of both worlds of declining oil revenues and a large pre-existing budget deficit.

 

The time to bury our heads in the sand is long past and the government needs to cut back on subsidies, reduce government size, and eliminate fiscal duplications. Fiscal governance must get better and all 'politically correct' talk about our debt not being a problem should be shelved; or better still, moved for further discussion under the MTEF (see below). 

 

Download:

HMFBNP MTEF-FSP 2020 - 2022 consultative Presentation 10.09.2019 v1 

 

Proshare Nigeria Pvt. Ltd.

 

Related Links - Proshare Economy

 

Proshare Nigeria Pvt. Ltd. 

 

Related News - Taxes & Tarriffs

1.       Tax Appeal Tribunal Delivers Landmark Ruling against Abia State Board

2.      The New Migrant e-Registration Guidelines - Nigeria Immigration Service

3.      Tax 101 - How The Proposed VAT On Online Transactions Will Affect You

4.      N311.94bn Generated As VAT in Q2 2019 - NBS

5.      FIRS Issues Final Demand Notice To Companies Whose Bank Accounts Are Under Lien

6.      FIRS Public Notice On Deduction At Source of WHT And VAT On Compensation Paid By Principal Companies

7.      NSE to Resumes Charging VAT on Commissions Applicable to Capital Market Transactions

8.     Tax Tribunal Rules That A Taxpayer Can Object To A Defective Assessment Even If It Has Been Paid

9.      Re-Introduction of VAT on Market Transaction Charges Take Effect From July 25th, 2019

10.  Tariff Hikes and Rising Customs Revenue

11.   Court of Appeal Affirms the Applicability of VAT on Services Rendered by a Non-Resident Company

 

Related News - Economy

  1. August 2019 Inflation Set to Inflect Upwards By 0.07% To 11.15%
  2. Buhari's First 100 Days: Honeymoon or Honeyfire?
  3. Q2 GDP Growth Slumps to 1.94%: But There Is "Fire in Soweto"
  4. Fasten Your Seatbelts, There Is Turbulence Ahead - LBS Executive Breakfast Session - Sept 2019
  5. Total Value Of Capital Importation Stood At $5,820.21m In Q2 2019 - NBS
  6. Q2 2019 GDP: Oily Exit From Recession and Services Fuels Growth
  7. Nigeria's GDP Grew By 1.94% YoY In Real Terms In Q2 2019 - NBS
  8. FAAC Disburses N762.6bn in July 2019 - NBS
  9. FAAC Disburses N679.7bn in June 2019 - NBS
  10. Market Interest Rates Back Up - Coronation Research
  11. NESG Dialogue: Stakeholders Call For Competitive Agric Seeds Industry in Nigeria
  12. Agenda For The New Federal Cabinet - FSDH
  13. Setting The Pace For The Next 4 Years
  14. Is Nigeria Immune To The Next Global Slowdown?
  15. PMB Second Term Cabinet: Experts, Analysts Set Targets For Finance Minister
  16. Strength From Abroad: The Economic Power of Nigerians In Diaspora
  17. Nigeria: Inflation Lower But The Storms Are Gathering - Food Import Restriction Yet To Bite
  18. ERGP: Economists Call For a Long-Term Economic Framework
  19. NESG Visits Proshare, Solicits Strategic Media Collaboration Ahead of NES25

 

Proshare Nigeria Pvt. Ltd.


Proshare Nigeria Pvt. Ltd.

READ MORE:
Related News
SCROLL TO TOP