The minister of finance, Zainab Ahmed, has revealed that there would be an increase in value-added tax, VAT on specific items in 2019.
Speaking on Wednesday at the inauguration of the Strategic Revenue Growth Initiative, Ahmed said the federal executive council will take a request to the national assembly for an amendment of the VAT law.
“We are studying a possibility of a VAT increase but you also know that the increase of VAT requires an amendment of the law,” he said.
“It is most likely the VAT increase will be selective. It will be on special items so it won’t be across the board. I am sure you are already aware that there are a number of items that are exempted from VAT such as food and drugs.
“There would be a VAT increase during the course of 2019, we will announce later the items and what the rate will be. We will have to take a request to the National Assembly for amendment of the VAT law before it takes effect.”
Representatives of the Federal Inland Revenue Service (FIRS), Nigeria Customs Service (NCS), Nigeria National Petroleum Corporation (NNPC), Accountant-General of the Federation and Nigeria Sovereign Investment Authority were present at the launch.
Also present, were representatives of the Debt Management Office (DMO), Central Bank of Nigeria (CBN) and the National Insurance Commission (NAICOM).
Babatunde Fowler, FIRS chairman, said the service plans to collaborate with banks to get names of companies and individuals with funds in excess of N1 billion and ensure that appropriate tax was collected.
According to him, the service will also link up with the Nigeria Customs to get data on companies that import goods into the country to ensure that they pay their fair share of tax.
In addition, he said that henceforth, the FIRS would ensure that it collects tax on properties owned by corporate entities in the country.
On his part, Hammed Ali, comptroller-general of the Nigeria Customs Service, said that the Service would focus on reducing smuggling and illicit financial flow of goods.
According to him, the Service will like to introduce new excise duties, but at the moment, the country only collects excise duty on alcohol and cigarettes.
He said the Service would also like to look carbonated drinks since they also have health implications for consumers.
Ahmed Idris, the accountant-general of the federation (AGF), said his office would like to introduce the use of treasury single account to all existing Nigerian embassies to enhance revenue.
As a way of blocking leakages, the AGF said his office would also link revenue generating agencies to the government integrated financial management information system (GIFMIS).
He said that GIFMIS implementation would enable the federal government process financial transactions faster and also reduce opportunities for corruption.