Senate Passes Bill to Raise VAT to 7.5%

By Dipo Olowookere

The Finance Bill, which was submitted last month by President Muhammadu Buhari to the National Assembly, has been passed by the Senate. The bill seeks to increase the Value Added Tax (VAT) from its present 5 percent to 7.5 percent from January 2019.

Mr Buhari submitted the bill alongside the Appropriation Bill to a joint session of the parliament. He had said at the presentation that the Finance Bill was aimed at increasing the revenue generated by the country.

After the bill passed first and second readings at the Senate, it was passed to the Senate Committee on Finance headed by Mr Solomon Adeola.

At the plenary on Thursday, Mr Adeola laid report of the committee before his colleagues after holding a public hearing this week to get inputs from different stakeholders, including from the public and private sectors.

One of the contributors at the plenary today, Mr Olubunmi Adetunmbi, informed his colleagues that the public hearing was well attended by virtually all the big accounting firms in Nigeria.

“They sent a message through this committee that they want to thank the federal government for bringing this innovative legislation and that it is something that the public has expected so long and they look forward to a more regular review of the tax regime of Nigeria,” he said.

On his part, the Senate President, Mr Ahmad Lawan, who presided over the session, said, “Let me thank all of us for passing the seven Acts in the Finance Bill to ensure that we streamline the tax system in Nigeria and ensure that we get revenue for government to provide infrastructure for this country.

“What we have done is very significant because this is to ensure that we not only have sources of funding for the 2020 Budget but also for subsequent activities of government.”