On Wednesday, the federal government announced that this year’s value-added tax (VAT) would be increased.
At the unveiling of the government’s strategic revenue growth initiatives in Abuja, Finance Minister Zainab Ahmed said the initiative was to boost accruals in government coffers and sustain revenue generation in all sectors.
“We are studying a possibility of a VAT increase but you also know that the increase of VAT requires an amendment of the law. It is most likely the VAT increase will be selective. It will be on special items so it won’t be across the board.
“There would be a VAT increase during the course of 2019, we will announce later the items and what the rate would be. We would have to take a request to the National Assembly for amendment before it takes effect.
“President Muhammadu Buhari has mandated the Federal Ministry of Finance to generate more revenues to finance national development and to proactively monitor collections by all Ministries Departments and Agencies (MDAs) involved in revenue generation.
“The government will also be looking at new revenue streams and enhanced enforcement with regard to revenue collection from our existing revenue streams.
“Through the initiative, we hope to achieve cohesion between revenue generating entities and equipping them with cutting-edge tools and expertise needed to support high performance.”
Speaking, Mr. Babatunde Fowler, Chairman of the Federal Inland Revenue Service( FIRS), said that the parastatal will work with Deposit Money Banks( DMBs) to “receive names of companies and individuals with funds exceeding N1 billion and ensure that appropriate taxes are collected.”