Economy News

There is No Increase in VAT- Udoma tells National Assembly

There is No Increase in VAT- Udoma tells National Assembly
  • PublishedFebruary 14, 2017

The Minister of Budget and National Planning, Senator Udoma Udo Udoma has clarified that although the Federal Government is working on increasing its internally generated revenue by broadening its tax base, it does not intend to increase taxes.

Senator Udoma said this in response to a comment by Senator Ben Bruce at the public hearing of the Joint Session of the National Assembly on the 2017 Budget. The Minister said “there is no increase in VAT, there is no increase in company’s income tax, there is no increase at all in taxes, but people who are not paying taxes must be made to pay. So the idea is to increase revenue by broadening the tax base, not by increasing taxes.”

The Minister told the gathering, which also included Civil Society Organizations and private sector operators, that virtually all the experts’ suggestions on improving the nation’s economy have been captured in the 2017 Budget.

“The concerns that have been expressed are reflected in the budget. The need to spend our way out of recession is reflected in the budget. The need to spend in a way that will attract private sector spending is also reflected in the budget. Indeed, the thrust of the budget is to partner with private and development capital to leverage and catalyse resources for growth.

“If you look at housing we are putting in N100 billion but we are expecting another N900 billion from the private sector. If you look at the EPZ, we are putting in N50 billion but we are expecting a huge injection of funds from the private sector. So, this budget is aimed at achieving economic growth, aimed at achieving diversification, aimed at improving our competitiveness, aimed at improving ease of doing business, aimed at creating more jobs and social inclusion, and aimed at improving governance and security.”

According to him, the spending is targeted at areas that have quick transformative potentials such as infrastructure and agriculture, manufacturing, solid minerals, services and so on.

The Minster pointed out that the present government believes in planning. “When we came in, we came out with a document – the Strategic Implementation Plan for the 2016 Budget of Change. We set out short term plans for one year. We started working on a longer term plan for four years 2017 -2020; and that involved extensive consultation”.

The minister also attested to the fact that FG is working with state governments in revamping the Nigerian economy. “We are working closely with the States. We even organized a Retreat in February 2016 with all the States. In all our initiatives we are working with the States. On Agriculture we are working with the States; we even have task forces that involve State governors. So, we are working together with the States…. Just last week we met twice with captains of industry and members of the private sector to sit down and expose the plan to them and get their input. We are going to Council soon and subsequently the plan will be launched before the end of the month.”

The Minister said because government has bold plans which are tailored towards pulling the country out of recession, investors are changing their attitude towards Nigeria. “People have heard of our plans; they have seen the plan because we have had extensive consultations with our development partners – with the World Bank, with IMF, with UNDP. They have all been exposed to our plan and we have shown them what we are determined to do, that is why people are believing in Nigeria and investing in the Eurobond.“

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