Edun Announces 15% VAT Increase, Targeting Only High-End Products

Edun Announces 15% VAT Increase, Targeting Only High-End ProductsThe Minister of Finance and Coordinating Minister of the Economy, Wale Edun, has confirmed plans for the federal government to increase the Value Added Tax (VAT) rate to 15%. This increase will primarily target luxury goods.....KINDLY READ THE FULL STORY HERE▶

Speaking at an investor forum during the IMF/World Bank Annual Meetings in Washington, D.C., Edun explained that the proposed VAT hike is currently under consideration by the National Assembly and will be implemented gradually. He emphasized that essential goods, particularly those consumed by poorer and vulnerable Nigerians, will remain exempt from VAT or will be taxed at a zero rate.

“President Bola Tinubu is committed to ensuring that, while we undertake necessary reforms, the poorest and most vulnerable are protected,” Edun stated. He added that the VAT increase will primarily affect luxury items, with essential goods remaining exempt. The government plans to release a detailed list of these exempt goods for public clarity.

Positive Outlook for the Oil Sector

Edun also expressed optimism about Nigeria’s oil industry, citing improved security in oil-producing regions and significant investments from major companies like Total and ExxonMobil. He believes these factors will lead to increased oil production and enhance foreign exchange earnings for the country.

Full Implementation of Subsidy Removal

On the topic of fuel subsidies, Edun clarified that while the policy was announced earlier, the full removal took effect only last month. He noted that the economic benefits of this decision, particularly the resulting savings, will become clearer in the coming months.

Issuance of Domestic Dollar Bonds Despite IMF Concerns

In response to inquiries about a potential IMF program, Edun mentioned that the Tinubu administration has proceeded with issuing domestic dollar bonds, despite the IMF’s advice against it. He reaffirmed Nigeria’s autonomy in financial decision-making while maintaining a collaborative relationship with the IMF, which continues to offer support.

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