By Adedapo Adesanya
Following the hike in the value added tax (VAT) from five percent to 7.5 percent in February 2020 by the federal government, the revenue generated by the country through the payment increased to N339 billion in the first quarter of the year.
This information was revealed in a report released by the National Bureau of Statistics (NBS) titled Sectorial Distribution of Value Added Tax (VAT) Q1 2020.
The VAT increase, which kicked off on February 1, 2020, brought in an additional N30.5 billion into the coffers of the nation, boosting the country’s revenue by 9.9 percent quarter-on-quarter from N308.5 billion recorded in the fourth quarter of 2019.
It also represented a 15.7 percent rise year-on-year when compared with the N293.04 billion realised in the comparative period of 2019.
According to the sectoral distribution of VAT data for Q1 2020, which was published by the statistical authority, professional services generated the highest amount of VAT with N38.3 billion overtaking “Other Manufacturing” sector which has been in the top position of VAT generation over the years.
This sector followed in second generating N37.4 billion while commercial and trading sector generated N17.2 billion.
Agriculture and plantations sector generated N973.26 million, textile and garment industry and local government councils recorded N306.05 million and N319.04 million respectively.
The Mining sector recorded the least amount of VAT totalling N61.8 million during the period.
Out of the total amount generated in Q1 2020, Non-Import VAT locally accounted for N172.7 billion while the foreign component stood at N93.7 billion.
The balance of N72.6 billion was generated as Nigeria Customs Service (NCS)-Import VAT.
Dipo Olowookere