By Frank Momoh
From its current 5%, the Federal Executive Council (FEC), has given nod to additional increase of 2.2%,
upping the Value Added Tax (VAT) to 7.2% though with no specific take off date, SHARPEDGENews can authoritatively inform.
Mrs. Zainab Ahmed, the Minister of Finance and National Planning while briefing Journalists after the FEC meeting in Abuja said however that consultation is ongoing to smoothen rough edges for the final take off of implementation.
She said: “We have reported to FEC and they have agreed that we kickstart the process towards the increase of VAT.
“The ministry is proposing and FEC has agreed that it should now be 7.2%.
Explaining the sharing formula on the proceeds from VAT, she said federal government will make do 15%, while States and Local Governments take 85%, adding that this becomes necessary so that states can meet the 30% minimum wage baseline.
On the 2020 budget, the minister said the sum of N10.07 trillion had been earmarked, adding that on the 2019 performances, recurrent did 100% while N300 billion had been released for capital.
Expected revenue for 2020, according to her is pegged at N7.5 trillion, adding that that fiscal year has a debt servicing out at N2.45 trillion.
However, Ahmed said federal government will be receiving proposed aggregate of N4.3 trillion from the federal account and the VAT pool, while both the states and local governments are expected to receive N3.04 trillion and N2.27 trillion.