Shell Energy Entrepreneurs banner Yudala banner
Revenue Commission to FG: Increase VAT from 5 percent to 7.5 percent

By News Express on 15/07/2016

Share on facebook Yahoo mail icon Gmail icon

Views: 1,607

The Federal Government has been urged to increase Value Added Tax (VAT) from 5 to 7.5 per cent to shore up the country’s revenue base.

This call was made on Thursday in Kano by Mr. Shettima Gana, the Chairman, Revenue Mobilisation, Allocation and Fiscal Commission (RMAFC), at a two-day National Revenue Retreat.

Explaining on new strategies that can expand the revenue base of the government, Gana said that Nigeria’s current VAT rate of 5 per cent was very low.

According to him, the charge being collected on goods and services in the country was one of the lowest in the world.

South Africa VAT was 14 per cent; Togo, Senegal, Guinea and Chad have VAT of 18% respectively. Niger meanwhile has VAT of 19 per cent he cited as examples as to why the country needs to increase her VAT.

He called on the Federal Government to initiate process to that would enable increase in VAT between 7.5 per cent and 10 per cent. .

VAT is a major source of revenue he said and could be used to shore-up revenue required for financing the ever-expanding public expenditure and the needs of all the tiers of government, Gana said.

A comprehensive research should be initiated, he said, to collect data from the Corporate Affairs Commission, (CAC) banks, and state ministries of trade and others, to determine and capture all possible VAT targets.

He added that taxation was seen globally as the most stable source of government revenue for economic development, yet it was not being properly utilised in Nigeria.

He called on the Federal Government to introduce additional taxes, such as toll tax for road, luxury goods tax on mansions, exotic cars, private jets and jewelleries. Also, the government should introduce inheritance tax, which would be paid by a person who inherits money or property from dead relations, he added.

As additional sources of income, he said it was imperative to develop agriculture, mining and tourism sectors, as he said are possible huge revenue sources for the government.

According to Gana, governments should enhance collection efficiency of taxes and block leakages in revenue collection. As a way to ensure efficient method, he urged the governments to beef up revenue monitoring and intelligence gathering.

With the introduction of new taxes, he said, government would generate more revenue to ultimately expanding the economy, which could as well create employment.

Speaking at the event, the Director, Revenue and Investment in the office of the Accountant-General of the Federation, Mr. Bakari Wadinga, said there was urgent need to harmonise Personal Income Tax (PIT) collection.

According to him, government should FIRS should be allowed to take over the collection of PIT and should model it after VAT collection. He stated that the current practice where every state collects its own PIT was not only ineffective but also leads to huge revenue loss.

Mr. Wiadinga said, “It will be recalled that prior to the introduction of VAT in 1993, it was the sales tax which was being collected by state governments.

“In 1992, the total collection by the entire states of the federation put together, was less than N300 million, but by 1994, when VAT came into effect, the total VAT collections rose to N7 billion.”

He added that, “By 1995 it rose to N21 billion and 10 years after, VAT rose to N222.6 billion in 2006 and over N700 billion in 2013.

“Thus, greater tax revenue could be raked in if there is collaboration on PIT collection by both states and federal government.”

Wadinga said that if this was adopted, it would result in greater tax revenue generation for sharing.

VAT is collected by the Federal Inland Revenue Service and shared to the three tiers of government. The Federal government receives 15%, state governments, 50% and local governments, 35 per cent.

It could be remembered the Managing Director of the International Monetary Fund, (IMF) Christine Lagarde, during her visit to Nigeria early this had said, “The current VAT rate is among the lowest in the world and well below the rates in other ECOWAS members—so some increase should be considered.” (Independent)

•Photo shows RMAFC Chairman, Shettima Gana.

Source News Express

Posted 15/07/2016 04:40:04 AM


Share on facebook Yahoo mail icon Gmail icon



Let us build the most comprehensive online database of worthy and credible Nigerians from all walks of life. It is worth doing!

Loss Off Your Belly Fats, Upper Arm Fat and Body Fats In 2weeks Time.. Click HERE To Start Now!


You may also like...
Nigeria’s military chief visits Chad to mobilise against...

Terrorism war: Build barracks in Sambisa Forest, HURIWA...

Soldiers rescue 1,000 oil workers ‘locked in’ by...

CHAMPIONS CHELSEA!: Blues stun Benfica, win Europa League...

NiMET predicts cloudy Thursday, with chances of localised...

Breaking News: Boko Haram invades Gombe

Ortom orders reopening of Benue varsity

Financial Markets close for Eid-el-Kabir celebrations

Police moves to stop illegal detention, torture, extortion...

How Ex-Air Chief Alex Badeh used N800m NAF...

FG frowns at attacks on security agents, warns:...

UK-based Nigerian security expert backs Buhari to finish...


Latest News Army sets up cattle ranches across the country South East APC leaders reject Okorocha Concerned Nigerians drag Buhari to court, want NIA’s new DG sacked 300 give birth in IDP camp Police captures kidnapper of Americans, Canadians in Kaduna Goal feast in EPL as Arsenal, Chelsea win, United close in on City Buhari crowns Obasanjo ‘Father of Open and Distance Education in Nigeria’ Dickson advocates more support for education •Hails OBJ for NOUN PhD feat Cameroonian refugees flood Nigeria Ambode declares war on refuse, vows to clean up Lagos NiMet predicts sunny, hazy, mist/fog, cloudy skies on Sunday Fresh PDP collapses after only one month


Most Read Nigerian female sex addict opens up, says ‘I like it with both men and women’ (315,791 views) NUDE PHOTO OF OMOTOLA JALADE-EKEINDE surfaces online (305,947 views) Shameless Genevieve Nnaji exposes breasts in public (245,204 views) Finally named: The full list of friends of Nigerian female sex addict who prowled Facebook (201,608 views) Igbo scholar disgraces Femi Fani-Kayode •Demolishes claims on Igbo/Yoruba history with facts and figures (190,246 views) OLUMBA OLUMBA OBU (the one who called himself God) IS DEAD (179,588 views) Breaking News: POPULAR REVEREND CONVERTS TO ISLAM in Kaduna (Nigeria) (155,701 views) OBJ’s son reported dead in Lagos plane crash •Names of more victims emerge (140,021 views) THE FINAL DISGRACE: Igbo scholar unleashes more facts about Igbo/Yoruba history, finishes off Femi Fani-Kayode with second article (136,154 views) Lagos plane crash: Journalist releases victims’ names (124,626 views) My wasted years in Olumba Olumba Obu’s Evil Brotherhood (121,899 views) Gunmen kill ASP, 2 other police officers in vain bid to kidnap Rivers PDP chieftain (119,039 views)


Categories Advertorials (3) African Press Organisation (81) Art & Literature (33) Business (2,854) Business Verdict (32) Columnists (792) Complaints & Requests (94) Enterprise & Opportunities (200) Entertainment (431) Features (541) Global Business Monitor (222) International (1,749) Interviews (139) Live Commentary (28) Love Matters (100) News (32,043) Opinion (868) Pidgin (10) Politics (4,362) Religion (666) Sports (1,408) Stock Watch (26) AMA & Al Jazeera Global Update


CBN Banner advert

CBN Words on marble



Thierry Henry in Lagos Nigeria


APO Group Partner



Loss Off Your Belly Fats, Upper Arm Fat and Body Fats In 2weeks Time.. Click HERE To Start Now!

Let us build the most comprehensive online database of worthy and credible Nigerians from all walks of life. It is worth doing!

GOCOP Accredited Member

GOCOP Accredited member



Africa Media Agency and Al Jazeera





Loss Off Your Belly Fats, Upper Arm Fat and Body Fats In 2weeks Time.. Click HERE To Start Now!

Let us build the most comprehensive online database of worthy and credible Nigerians from all walks of life. It is worth doing!