VAT: Tuitions, food items, others exempted from increased tax - Presidency

VAT: Tuitions, food items, others exempted from increased tax - Presidency

- The presidency has responded to reactions from Nigerians following the Finance Bill recently signed into law

- A statement from the office of Vice president Osinbajo stated that some locally made items, as well as tuition fees, are exempted from the Value Added Tax (VAT)

- The statement also said that businesses with less than N25 million as annual turnover will not be affected by the VAT

Following reactions and criticisms that have been triggered by the new Value Added Tax of 7.5%, the presidency has made some clarifications as well as revealed items that will not be affected by the increment.

According to a statement by Laolu Akande, the spokesperson of the vice president, Yemi Osinbajo, on Sunday, January 20, locally made commodities like sanitary towels, pads or tampons and services from microfinance banks as well as tuition for schools at all levels, will be exempted, PM News reports.

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Other items exempted from the VAT include additives (honey), bread, cereals, cooking oils, culinary herbs, fish, flour and starch, fruits (fresh or dried), live or raw meat and poultry, milk, nuts, pulses, roots, salt, vegetables, water (natural water and table water).

The statement said that 85% of the funds from the VAT will go to state and local governments for infrastructural development.

It further said that under the new finance act, businesses with less than N25 million as annual turnover will be charged zero Company Income Tax (CIT).

VAT: Tuitions, food items, others exempted from increased tax - Presidency
The presidency said that 85% of the funds from the VAT will go to state and local governments for infrastructural development.
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The statement said that the finance act will further create an enabling environment for the private sector to contribute to the growth of the nation's economy by boosting the revenues of federal, state and local governments.

Earlier, Legit.ng reported that despite agitation over the proposed VAT increment by the federal government, the minister of finance, budget and national planning, Zainab Ahmed, has said that the implementation of the new value-added tax rate would begin on February 1.

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The minister announced this at the ongoing inauguration of the Federal Inland Revenue Service (FIRS) board.

Legit.ng gathered that President Muhammadu Buhari signed the finance bill, which increased VAT by 50% into law on January 13.

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Source: Legit.ng

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