Oyedele denies proposing increment in VAT

Chairman, Presidential Committee on Fiscal Policy and Tax Reforms, Taiwo Oyedele, has denied advocating increment in Value Added Tax (VAT).

In his verified X account yesterday, Oyedele said the narrative was meant to serve a purpose that was unknown to him, saying what he said at the meeting, among other things, was that some items, which constitute basic consumptions (food, education, and healthcare) were liable to VAT rather than being exempt or zero-rated.

He noted that Nigeria’s VAT system placed a huge burden on businesses as they are not allowed to claim the input VAT incurred on services and assets.

Oyedele added that many small businesses had to contend with VAT compliance in view of the existing low VAT exemption threshold for small businesses.

“Many states charge other forms of consumption taxes in addition to VAT, thereby creating multiplicity of taxes. Export of services and intellectual property bear VAT rather than being zero-rated to promote exports.

To address the challenges and inconsistencies inherent in Nigeria’s tax system, Oyedele’s committee is proposing full input VAT credit for businesses to reduce their cost of doing business and minimise the strain on their cash flows.