President Muhammadu Buhari has announced that the 2020 budget will be based on the newly proposed 7.5% Value Added Tax (VAT). The disclosure was made by the President while presenting the 2020 budget to the National assembly on Tuesday.
According to the President, the additional revenue to be generated from the higher VAT rate would be deployed to the health and education sectors as well as the various infrastructural development programs.
Recall, that the Federal Executive Council had recently approved the increment of the VAT from 5% to 7.5%.
While the proposed VAT increase still awaits the approval of the National Assembly in order to give it a legal backing, this suggests that the Federal government already assumes that the newly proposed VAT will definitely get the backing of the national assembly.
Meanwhile, the President stated that the VAT Act already exempts Pharma, Educational items and basic commodities.
More details shortly…