Federal government proposal to hike VAT from 7.5% to 10% may be accepted by new government
Following the call by the Minster of Finance to hike VAT from 7.5% to 10%, the new government if facing calls from several quarters to increase VAT to nearer the regional average. Nigera, the largest economy in Africa,raised from 5% to 7.5% in 2020.
Surrounding countries, Benin and Cameroon, have standard VAT rate of 18% and 19.5%, respectively.
Nigerians voted to elect a new president on 25 February and he will be sworn in on 29 May 2023. Nigeria’s economic growth slowed to 3.52% in the fourth quarter from 3.98% a year earlier as widespread flooding destroyed farms, oil production declined and industry was squeezed by rising costs. This has put pressure on government receipts leading to Value Added Tax rate rise calls.
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