The Federal Government of Nigeria is reportedly set to implement an aggressive approach to Value Added Tax (VAT) revenue collection.
Reports has it that this approach, which is part of its 2022 fiscal policy, is expected to yield about N316 billion next year.
It will be recalled that the FG had in 2020 introduced various consumption taxes and increased the VAT rate to 7.5 percent from five percent in a bid to raise its revenue in the face of falling oil prices.
In lieu of this drive, the FG is also expecting to rake about N29.3 billion as charges from solely from electronic money transfers. The government also raised its target from other tax heads under the non-oil revenue tax, which include the Company Income Tax (CIT), customs revenue and the federation account levies, leading to 59.3 percent increase in the 2022 non-oil revenue (N2.132trn) budget when compared to N992.63 trillion budgeted this year.
The targeted VAT revenue for 2022 is 99.2 percent higher than N158.95 billion budgeted in 2021 and represents 3.12 percent contribution to the total targeted N10.13 trillion government’s revenue for the year.
Friction had taken place between federal government and some states which Lagos and Rivers take the fore over VAT from the past few months. Five northern states however, which include Adamawa, Plateau, Kaduna, Kogi and Zamfara are reportedly set to take side with the federal government’s new policy.
In the same way, the government is set to raise N909.30 billion from CIT, which is a 100.07 percent increase over N454.48 billion budgeted in 2021.
Customs revenue witnessed an increase of 146.2 percent, federation account levies by 78.41 percent.
