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Published On: Tue, Jan 14th, 2020

Buhari approves 7.5% VAT increase

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• As he signs Finance Bill into law

By Lawrence Olaoye

President Muhammadu Buhari has signed the 2020 Finance Bill into law.
The Finance Bill allows an increase of the VAT rate from 5 per cent to 7.5 per cent , as such, the 2020 Appropriation Bill is based on this new VAT rate.
This, according to a statement made available to newsmen yesterday by his spokesman, Femi Adesina, was sequel to its passage by the National Assembly and subsequent forwarding by the legislature to the President for assent.
Recall that the President while presenting the 2020 Appropriation Bill to the National Assembly, had also presented the Finance Bill and said: “This Finance Bill has five strategic objectives, in terms of achieving incremental, but necessary, changes to our fiscal laws.
“These objectives are: Promoting fiscal equity by mitigating instances of regressive taxation; Reforming domestic tax laws to align with global best practices; Introducing tax incentives for investments in infrastructure and capital markets; Supporting Micro, Small and Medium-sized businesses in line with our Ease of Doing Business Reforms; and Raising Revenues for Government.
“The draft Finance Bill proposes an increase of the VAT rate from 5 per cent to 7.5 per cent , as such, the 2020 Appropriation Bill is based on this new VAT rate,” he added.
With the assent, there will be more revenue to finance key government projects especially in the areas of health, education and critical infrastructure,” he stated.

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