Business Insight

INCREASED VAT: Innovation or a desperate move?

The federal government of Nigeria is keen on making more money even as the country appears to need more revenue streams. Due to sustained shortfalls in revenue and an increase in government spending there is a need to find ‘innovative’ ways to scale up revenue.

The country’s finance minister introduced the strategic revenue growth initiative last Wednesday. By increasing VAT from 5% to 7.5%, the government hopes to make a little more than 2 trillion naira in 2020. This is the government’s way of increasing non-oil revenue.

The Nigerian government has consistently relied on borrowed money to finance its growing funding needs. For an economy that has relied on oil for so long, we need to find other ways to raise money to run the country. However, the announcement by the finance minister has been met with mixed reactions. The important question to ask is “how will this affect the everyday Nigerian?” The proposed increase comes in a time when the nation suffers from the worst form of economic uncertainty. This money will be raised in order to cover the #30,000 minimum wage amongst other things.

Do you think this move is an innovative one or a desperate one? Please share your thoughts.

Please follow, like and share:

Leave a Reply

Your email address will not be published.

Privacy Settings
We use cookies to enhance your experience while using our website. If you are using our Services via a browser you can restrict, block or remove cookies through your web browser settings. We also use content and scripts from third parties that may use tracking technologies. You can selectively provide your consent below to allow such third party embeds. For complete information about the cookies we use, data we collect and how we process them, please check our Privacy Policy
Consent to display content from - Youtube
Consent to display content from - Vimeo
Google Maps
Consent to display content from - Google
Consent to display content from - Spotify
Sound Cloud
Consent to display content from - Sound