Thursday, May 29, 2025 - President Bola Tinubu has announced that Rents, Public transportation and renewable energy will be fully exempt from paying Value Added Taxes, VAT.
The President, who made this known in his 2nd year
anniversary statement, said this move is being made to ease the burden of cost
on households. He also mentioned that essential goods such as food, education
and healthcare will now enjoy 0% VAT.
In his words;
‘’One of our
administration's most impactful achievements is our bold tax reform agenda,
which is already yielding results. By the end of 2024, our tax-to-GDP ratio
rose from 10% to over 13.5%, a remarkable leap in just one year. This was not
by accident. It results from deliberate improvement in our tax administration
and policies designed to make our tax system fairer, more efficient, and more
growth-oriented.
We are
eliminating the burden of multiple taxation, making it easier for small
businesses to grow and join the formal economy. The tax reforms will protect
low-income households and support workers by expanding their disposable income.
Essential goods and services such as food, education, and healthcare will now
attract 0% VAT. Rent, public transportation, and renewable energy will be fully
exempted from VAT to reduce household costs further.
We are
ending the era of wasteful and opaque tax waivers. Instead, we have introduced
targeted and transparent incentives supporting high-impact manufacturing,
technology, and agriculture sectors. These reforms are not just about revenue
but about stimulating inclusive economic growth.
There is a
deliberate focus on our youth, who a friendlier tax environment for digital
jobs and remote work will empower. Through export incentives, Nigerian
businesses will be able to compete globally. Our National Single Window project
streamlines international trade, reduces delays, and enhances Nigeria's
competitiveness.
To promote
fairness and accountability, we are establishing a Tax Ombudsman, an
independent institution that will protect vulnerable taxpayers and ensure the
system works for everyone, especially small businesses.
Most
importantly, we are laying the foundation for a more sustainable future by
introducing a new national fiscal policy. This strategic framework will guide
our approach to fair taxation, responsible borrowing, and disciplined spending.
These
reforms are designed to reduce the cost of living, promote economic justice,
and build a business-friendly economy that attracts investment and supports
every Nigerian. Together, we are creating a system where prosperity is shared,
and no one is left behind.''
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