Former Vice-President Atiku Abubakar has condemned the Federal Government’s plan to raise the VAT, warning that this decision could ignite a “blazing inferno that will consume the very essence of our people.”
In an interview on Channels TV’s Politics Today, Taiwo Oyedele, Chairman of the Presidential Fiscal Policy and Tax Reforms Committee, revealed that the committee is proposing legislation to the National Assembly aimed at increasing the value-added tax from 7.5% to 10%.
He stated, “We are facing significant challenges in our tax revenue. Our overall revenue streams—both tax and non-tax—are under severe strain, illustrating a fiscal system in crisis.
“When my committee was formed, we had three main objectives. The first was to assess governance: our nation’s finances, borrowing practices, and coordination within the federal government and across sub-national entities.
“The second focused on revenue transformation. The country’s revenue profile is alarmingly low; dedicating our entire revenue to road repairs would leave us wanting. Our third focus involves government assets.
“The proposed legislation would increase the VAT rate from 7.5% to 10% starting in 2025. We cannot predict how quickly the National Assembly will pass this law. Additional future increases are also indicated, pending their implementation timelines.”
In a statement released on Sunday, Atiku criticized this plan, especially in light of the recent hike in the price of Premium Motor Spirit (PMS) by the Nigerian National Petroleum Corporation Limited (NNPCL), asserting that it is “set to deepen the domestic cost-of-living crisis and further strain Nigeria’s already fragile economic growth.”
The Peoples Democratic Party (PDP) presidential candidate in the last election emphasized that one need not be an economist to understand the “implications of President Tinubu’s misguided policies for Nigeria’s future.” He urged the President to prioritize sustainable solutions to the systemic shocks affecting the economy instead of exacerbating the crisis with measures that will lead to further turmoil.
Atiku remarked, “The VAT increase is poised to become the blazing inferno that will engulf the very essence of our people. Tinubu’s actions demonstrate a profound insensitivity to the struggles of the less fortunate while he indulges in lavish renovations of villas and acquires new jets and vehicles for himself and his family.
“President Bola Tinubu, along with his advisors, has chosen to raise the VAT rate from 7.5% to 10%, even as NNPCL has announced alarming increases in PMS prices.
“This decision ushers in a new era of regressive and punitive policies, destined to deepen the domestic cost-of-living crisis and further undermine Nigeria’s already fragile economic growth.
“President Tinubu and his circle seem to be employing the same old strategy: burdening the impoverished while obliviously continuing their extravagant lifestyles!
“Understanding the dire implications of President Tinubu’s ill-conceived policies for Nigeria’s future requires no specialized knowledge. The relentless increase in taxes and interest rates has become excessively burdensome, crippling businesses across the board and causing job losses while intensifying the suffering of the poor.
“The manufacturing sector, in particular, has faced relentless hardship since Tinubu assumed office, with its contribution to GDP plummeting by over 20% since December 2023, according to the NBS.
“In early August, Tinubu turned his focus to agriculture. Staying true to the administration’s pattern, a new policy was quietly developed and announced, allowing duty-free importation of agricultural commodities such as wheat, maize, and paddy, despite fierce opposition from farmer groups nationwide.
“This policy presents a serious threat to Nigeria’s food security ambitions, as local farmers, facing unfair competition from low-cost producers in Asia, Europe, and America, are forced to cut back or abandon their production efforts altogether. It jeopardizes job creation, wealth generation, and the long-term viability of the sector, casting a dark shadow over Nigeria’s sustainability and development.”
