The recent upward review of the Value Added Tax (VAT) rate from 5% to 7.5%, which implementation is timed to take effect from 1st February, will not affect ordinary Nigerians, Ahmed Lawan, the President of the Senate, has said.
Lawan affirmed that the increase was only applicable to luxury goods and, by implication, would not hamper the purchasing power of average Nigerians.
Mr Lawan made the disclosure Monday when asked to shed light on the buffers the National Assembly expected the Federal Government to provide in order to cushion the effects of the tax hike on the purchasing power of Nigerians.
In his words, “the 2. 5 per cent increment in VAT does not include items that ordinary Nigerians normally use.
“Many of the items that would now have additional 2.5 per cent increment are luxury items that ordinary Nigerians don’t use.”
The Senate President remarked that Nigeria required more resources to deliver basic facilities needed by average citizens.
Luxury goods in Nigeria include champagne, beers, exotic cars, cosmetics/fragrances, watches, jewellery, luggage/handbags, designer clothing, large residences/urban mansions, gadgets, yachts/other vessels used for pleasure among others.
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