The Federal Government has raked in N10.1tn from the collection of Value Added Tax, VAT, under the regime of the President, Major General Muhammadu Buhari (retd.).
This is contained in an analysis of reports from the National Bureau of Statistics which showed that VAT earnings continued to rise annually throughout the eight-year period.
The report revealed that the country earned N759.4bn in 2015, N777.5bn in 2016, N972.4bn in 2017, N1.1tn in 2018, in 2019 amounted to N1.2tn, N1.5tn in 2020, N2.1tn in 2021 while N2.5tn was paid in 2022.
This is coming following the advice by the Minister of Finance, Zainab Ahmed, that the incoming government should increase the VAT from the current 7.5 per cent to 10 per cent.
The Federal Inland Revenue Service administers the 7.5 per cent consumption tax when goods are purchased and services are rendered, and it is borne by the final consumer.
In 2020, the Federal Government increased the VAT rate from five per cent to 7.5 per cent as part of the tax reforms included in the 2019 Finance Act meant to help the government achieve its revenue projections.
Meanwhile, some economists have advised against increasing the VAT from 7.5 per cent to 10 per cent in the incoming administration.
They argued that it would stifle the country’s economic growth as inflation stands at 17.32%.
The finance minister made the call for the increment during a courtesy visit to the headquarters of Voice of Nigeria in Abuja recently, saying, “VAT is one of the ways to increase revenue and we still have to increase VAT because, at 7.5 per cent, Nigeria has the lowest VAT rate in the world, not in Africa, in the world.
“In Sub-Saharan Africa, the African average is 18 per cent, when you increase your VAT, your Gross Domestic Product will grow.
“So, tax compliance has increased. As a result, we have also adjusted our VAT rate from five per cent to 7.5, even though our target was 10 per cent. But you know how it is in Nigeria, we are targeting 10 per cent by the second year, we did so to increase revenue.”

Alleluia is the Assistant Editor and Content Writer at LagosPost.ng. She is a prolific writer and editor, she has written features and news stories on Lifestyle, Sports, Business, Politics and B2B marketing. She is also an event coordinator, host and social media content creator.