Banking & Finance Economy

VAT implementation takes effect Feb. 1– Minister

VAT implementation takes effect Feb. 1– Minister
Written by Maritime First

…As FG, states, LGs share N716.2bn for month of December***

The Minister of Finance, Budget and National Planning, Mrs Zainab Ahmed, declared on Thursday that the implementation of Value Added Tax (VAT) increase from five per cent to 7.5 per cent will take effect from Feb. 1.

Ahmed said this during the inauguration of the Chairman and Board members of the Federal Inland Revenue Service (FIRS) in Abuja on Thursday.

“We planned that going forward, the annual budget will always be accompanied by Finance Bills to enable the realisation of revenue projections.

“Future Finance Bills will therefore, provide us with additional opportunities to incrementally improve the fiscal policy and regulatory and legal environment.

“This is in order to further strengthen our domestic capital market, and ultimately ensure sustained and inclusive growth and development,” she said.

The minister recalled that the Finance Act had also taken care of essential palliatives to support Micro, Small and Medium Enterprises (MSMEs) and mitigate the impact of VAT rate increase on the most vulnerable businesses, communities and citizens in the economy.

While inaugurating the board, the minister urged the new board to ensure steadfastness of the service in meeting non-oil revenue targets to accelerate the nation’s development.

Ahmed said the board was saddled with various responsibilities, including the supervision of the FIRS.

In his remarks, the FIRS Executive Chairman, Mr Muhammad Nami, said the new board had dedicated itself to the task at hand as the nation was looking up to the service, to provide a leeway out of the present economic crunch.

“As a tax administrator and custodian of the Nigerian tax system, we have the responsibility to the nation to implement all tax policies and laws in a manner that would ensure optimal benefits to the nation.”

Nami said FIRS had a duty to strengthen, withstand and overcome the challenges that was ahead of it.

Also read:  Cashless policy: EEDC stops collection of cash above N3000 Feb 1

He pledged to rebuild FIRS institutional framework, robust collaboration with stakeholders, build a customer taxpayer centric institution and data centric institution.

He also said the board intended to achieve this through building staff capacity for service delivery and close all lien cases in order to build new enforcement strategies.

News Agency of Nigeria (NAN), reports that members of the board are Mr Muhammad Nami, the Executive Chairman of the FIRS, Mr James Ayuba (North-Central), and Mr Ado Danjuma (North-West).

Others are Mr Adam Mohammed (North-East), Mr Ikeme Osakwe (South-East), Mr Adewale Ogunyomade (South-West) and Mr Ehile Aibangbee (South-South).

Also inaugurated were members of boards of Ministries, Departments and Agencies (MDAs) of the Federal Government.

They are Ladidi Mohammed, Attorney-General of the Federation Office and Mr Folashodun Shonubi, Central Bank of Nigeria (CBN).

The membership also includes Hajiya Fatima Hayatu (Ministry of Finance), Mr Samuel Maagebe (Revenue Mobilisation Allocation and Fiscal Commission), and Mr Umar Ajiya (Nigerian National Petroleum Corporation).

Others include DCG Mairo Isah of the Nigeria Customs Servic (NCS) and Mr Garba Abubakar, Registrar-General of the Corporate Affairs Commission (CAC).

Meanwhile, the Federation Accounts Allocation Committee (FAAC) has shared N716.298 billion to the three tiers of government for the month of December 2019.

The Permanent Secretary, Ministry of Finance, Budget and National Planning, Alhaji Isa Dutse disclosed this while addressing newsmen on the outcome of the meeting in Abuja on Thursday.

Dutse explained that the amount shared comprised revenue from Value Added Tax (VAT), Exchange Gain and the Statutory Revenue.

He said the Federal Government received N287.929 billion, the State Governments got N191.302 billion, and the Local Government Councils received N143.698 billion.

He added that the Oil Producing States received N50.279 billion as 13 per cent derivation revenue and the Revenue Generating Agencies received N43.089 billion as cost of revenue collection.

He said the gross statutory revenue for the month of December 2019 was N600.314 billion, adding that it was higher than the N491.875 billion received in the previous month by N108.439 billion.

The permanent secretary stated that the gross revenue available from VAT was N 114.805 billion as against N90.166 billion distributed in the previous month resulting in an increase of N24.639 billion.

According to him, exchange Gain yielded a total revenue of N1.179 billion.

Dutse disclosed that there was increase in the revenue from FIRS, especially from the non oil revenue, which he said was about 48 per cent increase.

 

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