Bill Seeking to Hike VAT Passes Second Reading

  • Bill Seeking to Hike VAT Passes Second Reading

The bill seeking to increase Value Added Tax (VAT) from 5 percent to 7.5 percent passed the second reading on Wednesday amid drama.

Few Senators had objected to the reading without seeing a copy of the said bill in accordance with the rules of the National Assembly.

Ahmad Lawan, the President of the Senate, however, insisted that the reading must go on even without lawmakers reading or knowing the content of the said bill.

Lawan said, “To handle that, we have already asked that our secretariat distributes all the Acts that we want to amend and I want to urge the committee to work very assiduously.

“This should not be compromised at all. Our colleagues who raised the issue did so because they wanted to contribute.

“I think what we have done is still within our tradition and our convention of debating the general principles.

“The issue of revenue in Nigeria today is the major issue affecting our economy.

“The economy of this country like most developing economies depends on public expenditure and until we are able to get it, collate them efficiently and effectively we will not be able to fund public expenditure well.

“This bill will help in generating and collecting this kind of revenue.”

Senate Leader, Yahaya Abdullahi, led the debate on the bill and buttress on what the Senate president stated that the bill sought to promote fiscal equity by mitigating instances of regressive taxation; reforming domestic laws to align with global best practices and introducing tax incentives for investments in infrastructure and capital markets.

The Federal Executive Council had approved a proposal seeking to increase VAT by 50 percent from 5 percent to 7.5 percent in August.

Despite criticism that followed the approval it appears the Federal Government is determined to pass the new tax bill to law and up its chances of funding the 2020 budget.

About the Author

Samed Olukoya
CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade long experience in the global financial market. Contact Samed on Twitter: @sameolukoya; Email: [email protected]

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