Nigeria’s ruling All Progressives Congress national leader, Bola Tinubu, Thursday opposed the federal government’s plan to increase the Value Added Tax (VAT).
“Consumers’ spending is slipping, and this is where I will stop and appeal to Professor Yemi Osinbajo, the Vice President, and his team to put a huge question mark on any increase of VAT, please,” Tinubu said at the Bola Tinubu Colloquium in Abuja.
“If we reduce the purchasing power of the people, we can further slow down the economy,” he added.
Tinubu’s cautionary statement is coming barely hours after Minister of Finance, Zainab Ahmed, said the Nigerian government has concluded plans to increase revenue by introducing new taxes.
Officials of the Federal Ministry of Finance defended the Medium-Term Expenditure Framework (MTEF) that VAT be increased by 50 per cent during a presentation in the Senate on Wednesday.
Apart from Tinubu, stakeholders in the business sector, including the Manufacturers Association of Nigeria (MAN) have also kicked against the decision.
MAN said VAT increase would leave the economy in a more vulnerable state.
The President of the United Labour Congress (ULC) said the workers’ union would not accept any increase on taxes.
Tinubu said the government should rather widen the tax net and include those who are not yet being taxed.
“Let’s make the nets get bigger so we take in more taxes,” he said.
“That is what we must do in the country instead of putting an additional layer of taxes for now.”
The VAT is currently being charged at five per cent.
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