- VAT to Aid Infrastructure Development, Social Amenities – Agba
Prince Clem Agba, the Minister of State for Budget and National Planning, has said the 50 percent increase in Value Added Tax (VAT) will aid infrastructure development across the country.
The Federal Executive Council (FEC) had approved a 50 percent increase in VAT from 5 percent to 7.5 percent in September.
The new rate expected to take effect in 2020 is still one of the lowest tax rates in the world, according to Prince Agba.
Agba said: “Nigerians are not complaining about the recent decision to increase VAT and government is merely increasing VAT by 2 and a half percent to make it 7.5 percent and if you don’t know Nigeria has the lowest VAT rate in the world, even in our West Africa coast, a lot of people talk about Ghana, that it has reduce their VAT recently and why are we increasing? Ghana has only reduced it tax from 15 to 12 while we are going from 5 to 7.5%.”
The Minister, who spoke at the 2019 Etsako Day celebration in Lagos at the weekend, advised Nigerians to start identifying natural resources within their regions and begin to draw attention to them for investment opportunities and job creation.
“I am a farmer myself but people still see agriculture as a thing that is local, that it is for local people but l tells you it is not. If we are self-sufficient in agriculture then we will be able to feed ourselves, that is where it all begins and if we can’t feed ourselves, then we will have problem with our foreign exchange that we keep talking about, we will start to use what we have earned from other sources to bring in food which is not good.
“If you go to the market and buy yam, potatoes, vegetable and others, you will not pay VAT but if you choose to go to Eko hotel and eat, you pay VAT because you can afford it.”
Agba, however, reiterated President Muhammadu Buhari’s commitment to the Nigerian people and explained that the new VAT increase “does not affect the common man because all the staple food, medication, education that has to do with the common man are VAT exempt.”