CEM REPORT:
The sum of N338.94bn was generated as Value Added Tax (V A T) in Q1 2020 according to the Sectoral distribution of VAT data released by the Nigerian Bureau of Statistics Thursday.
This is 9.87% increase Quarter-on-Quarter when compared to the N308.48bn generated in Q4 2019 and 15.66% increase Year-on-Year when compared to the N293.04bn generated in Q1 2019.
The NBS stated that Professional Services generated the highest amount of VAT with N38.30bn and closely followed by Other Manufacturing generating N37.37bn, Commercial and Trading generating N17.19bn.
Mining generated the least and closely followed by Textile and Garment Industry and Local Government Councils with N61.83m, N306.05m and N319.04m generated respectively, the report added.
Out of the total amounted generated in Q1 2020, N172.67bn was generated as Non-Import VAT locally while N93.67bn was generated as Non-Import VAT for foreign. The balance of N72.59bn was generated as NCS-Import VAT.
According to the data, Breweries, Bottling and Beverages increased at the highest rate of 60.85% Quarter on Quarter. The sector generated N14.34bn in Q1 2020 as against 8.91bn generated in Q4 2019.
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Transport and Haulage Services increased at the highest rate of 214.89% Year-on-Year generating N7.67bn in Q1 2020 as against 2.43bn generated in Q1 2019
On the reverse side, the data reveal that, Pioneering Industry went down in VAT generation by -64.08% Quarter-on-Quarter representing the highest drop in VAT generated. The Industry generated 868.9m in Q1 2020 as against 2.42bn generated in Q4 2019
Oil Marketing Industry had the least gap VAT generation Year-on-Year rising by only 1.90%. It generated 2.39bn in Q1 2020 as against 2.34bn in Q1 2019.
The Nigerian government had along with the 2020 budget forwarded a finance bill that increased VAT from 5% to 7.5% of which implementation commenced in February, 2020.
In the same vein, Minister for Finance Budget and planning said on Thursday May 14 that Nigeria may consider introducing VAT on gasoline sales in the next finance bill.
The Minister however maintained that, raising tax now would be disservice given recent VAT rate increase and economic hardship cause by coronavirus outbreak
