Implementation of 7.5% Value Added Tax (VAT) Begins

Again, the additional financial burden the Federal Government of Nigeria has been heaping on the citizenry since the All Progressive Congress (APC) came into power has started. It started today in the form of increment in Value Added Tax (VAT), which was until today 5 per cent. The government has said it is now 7.5 per cent effective February 1, 2020.

When the APC government came into power led by President Muhammadu Buhari, Nigerians have been reaping nothing but hardship through all manners of policies that are anti-people. First in 2015 when the Peoples Democratic Party (PDP) handed over to them was a heartless increase in the pump prize of petroleum products from N68 to N145. The fuel subsidy, which they said they would stop paying to marketers also did not stop. The Naira/United States Dollar exchange rate was also sharply increased to the extent that the USD exchange rose as high as N450/dollar before it stabilized at N365/USD for some time now.

Insecurity of lives and property has risen to all time high across the nation and religious intolerance has gone back to what it was in the pre-independent Nigeria with every geo-political zone in the country setting up its own security outfit to secure the lives and property of their region. With all these challenges, this may not really be the right time for the Buhari government to increase the VAT especially when Nigerians cannot really point to what the government has done in the last six years.

But not bothered by the feelings of Nigerians, the government enacted the Finance Act 2019, which announced that the implementation of the 7.5% Value Added Tax (VAT) rate under the new Finance Act will commence on February 1, 2020. Therefore in line with the Federal Government directives, deposit money banks in the country have informed their customers that VAT on each eligible bank transaction or service will be charged at the new rate of 7.5% with effect from February 1, 2020 meaning an addition of pain on already overstretched finances of the people.

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