TheCable

The National Bureau of Statistics (NBS) says revenue generated from value-added tax (VAT) increased by N15.86 billion within three months to N512.25 billion in the second quarter of 2021 (Q2 2021).

The NBS latest report showed that the VAT generated in Q2 2021 surged by 56.56 percent compared to the N327.20 billion recorded in the corresponding quarter in 2020.

N496.39 billion was generated from VAT in Q1 2021.

“Out of the total amount generated in Q2 2021, N187.43bn was generated as Non-Import VAT locally while N207.69bn was generated as Non-Import VAT for foreign,” the report reads.

“The balance of N117.13bn was generated as NCS-Import VAT.”

The sectors that generated the highest VAT in Q2 2021 include: Other manufacturing (N44.89 billion); professional services (N29.30 billion); commercial and trading (N21.96 billion); state ministries and parastatals (N18.41 billion); and transport and haulage services (N13.99 billion).

Meanwhile, the textile and garment industry generated the least VAT in the quarter in view with N77.74 million.

This was followed by pioneering; pharmaceutical, soaps, and toiletries; chemicals, paints and allied industries; and local government councils with N168.99 million, N188.71 million, N281.04 million, and N399.91 million generated respectively.

VAT is a consumption tax which is administered by the Federal Inland Revenue Service (FIRS).

Nigeria had raised its VAT rate from 5 percent to 7.5 percent in 2020, however, the International Monetary Fund (IMF) advised that the rate should be increased to at least 10 percent by 2022.

The IMF also advised Nigeria to increase the VAT rate to 15 percent by 2025.