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- Njoku Macdonald Obinna
Garden City , Nigeria .
The new Value Added Tax (VAT) rate of 7.5 percent will not take effect until the new Finance Bill is gazetted by the Federal Government, President , Charted Institute of Taxation of Nigeria (CITN) , Dame Olujumoke Simplice , has disclosed .
During a media briefing , she told newsmen that gazetting of the Bill is what gives it the power of implementation .
Dame Olujumoke said the Bill had stipulated that the implementation date would be January 1, 2020, but 18 was only signed on January 13.
According to taxation expert and public analysts , there are technical issues that have to be addressed before the VAT implementation earnestly begins , 4thestatereporters.com revealed .
Firstly , there is need to determine the effective implementation date as no implementation will take place until the Bill is gazetted . The CITN president, Dame Olujumoke Simplice , disclosed with a benefit of hindsight that the implementation date may later be by February 1, 2020. The law should not work in retrospect since gazetting is what truly gives the Bill wings to fly.
She however , maintained that , despite the sharp raise in VAT , Nigeria’s VAT is still one of the lowest in the world .
According to her , the late VAT review was 25 years ago. She said the country also has the lowest VAT rate in Economic Community of West Africa States (ECOWAS) sub -region.
What is VAT?, as someone reading this business report may ask ❗
“Value Added Tax (VAT) is a tax on consumption and is only paid when you consume goods or pay for services .”
While a number of powerful business men in Nigeria , with federal government back -up , have been living on free VAT regime , the renewed Nigeria’s decision to raise VAT is good for its trade relations with other countries . Needless to say that VAT is very easy to collect and should be properly utilised for the development of the economy through cutting edge e- technology approach.
Therefore , 4thestatereporters.com is of the strongest opinion that both state and federal governments should be held accountable on what funds from VAT are spent on , as these funds from non -oil produce should be judiciously used for developmental projects , the online media platform advocates .
According to Dame Olujumoke Simplice in one of her public addresses , the new VAT rate will increase prices of goods , but is unlikely to affect manufacturers because they will pass the increased prices of goods to consumers .
She therefore , advised tax payers to form a credible and formidable pressure groups to systematically monitor tax revenue spending and ensure accountability on the part of government at all levels ❗
- Njoku Macdonald Obinna
Media Consultant| •News Reporter | •Blogger
••• Redefining news reportage in the new media .