BY TheCable
The Director-General of Budget Office of the Federation, Dr Bright Okogwu, has canvassed an increase in value-added tax (VAT) from the current 5% to 10%.
He was briefing the Committee on Public Finance and Revenue at the National Conference on Friday, where he gave insight into the management of federal government fiscal operations.
The current 5% rate was introduced by the government of General Sani Abacha in 1994, and an attempt to increase it to 10% by President Umaru Musa Yar’Adua in 2007 backfired, forcing the government to reverse the decision.
VAT is a form of consumption tax levied on goods and services.
Nigeria’s 5% is one of the lowest in the world, with Ghana charging 17.5% and UK 20%, but some countries do not levy VAT at all.
A statement signed by Assistant Secretary, Media and Communications, Akpandem James, did not disclose details of Okogwu’s proposal or the rationale behind his suggestion.
However, the DG complained about the wage bill.
He said incessant strikes and demand for higher wages by workers had increased the nation’s salary bill from N857 billion in 2009 to N1.7 trillion in 2011.
Okogwu told the delegates that his office has been re-orienting ministries, departments and agencies on the budgeting process, a development which he said made it possible to increase capital expenditure in 2014 by 29.5% while that of 2013 increased it to 37.5%
He disclosed that money accruing from the partial removal of subsidy was N462 billion and appealed to the committee to recommend speedy passage of the Petroleum Industry Bill (PIB).
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