Tinubu Government Rejects Tax Committee Chair’s Proposals, Confirm VAT Stays At 7.5%
The administration of President Bola Tinubu has denied reports that the Value Added Tax (VAT) rate has been increased to 10%. This clarification was made by the Minister of Finance and Coordinating Minister of the Economy, Mr. Wale Edun.
In a statement issued on Monday, Edun confirmed that the VAT rate remains at 7.5%, as stipulated by Nigeria’s tax laws. He emphasized, “The current VAT rate is 7.5%, and this is the rate the government applies to a range of taxable goods and services. Neither the Federal Government nor any of its agencies will act against the provisions of our laws.”
Edun also highlighted the importance of a balanced tax system, which relies on the integration of tax policy, tax laws, and tax administration. According to him, these three pillars are essential to maintaining a fiscal system that supports the government’s economic goals.
He further noted that the government’s fiscal policies are designed to drive economic growth and alleviate poverty. “Our focus is on utilizing fiscal policies in a way that fosters sustainable economic growth, reduces poverty, and enables businesses to thrive,” Edun stated.
The denial follows a controversy sparked by earlier reports that the government was planning to increase VAT from 7.5% to 10%. Former presidential candidate of the Peoples Democratic Party, Atiku Abubakar, criticized the alleged proposal, accusing the government of burdening Nigerians amid tough economic conditions.
Atiku had voiced his concerns on X (formerly Twitter), warning that the VAT hike would worsen the cost-of-living crisis and further strain Nigeria’s fragile economy.
Meanwhile, the Chairman of the Presidential Fiscal Policy and Tax Reforms Committee, Taiwo Oyedele, acknowledged during an interview on Channels TV that the committee is proposing a law to the National Assembly to raise the VAT rate from 7.5% to 10%, effective from 2025. Oyedele mentioned that the timing of the law’s passage is uncertain, and additional incremental increases have also been suggested for future years.
