The federal government has announced that the commencement of the implementation of Value Added Tax (VAT) is to take effect from February 1, 2020, after all the necessary administrative procedures.

The VAT increase which is meant to help government achieve its revenue projections for the 2020 Budget (N8.155trillion) is a part of the tax reforms included in the 2019 Finance Act.

“With the Act, there will be more revenue to finance key government projects especially in the areas of health, education and critical infrastructure”.

The minister explained that among the Finance Act strategic objectives is to provide support for micro, small and medium Enterprises (MSMEs) in line with the ease of doing business reforms such as VAT threshold.

“We planned that, going forward, the annual budget will always be accompanied by Finance Bills to enable the realisation of revenue projections”.

“Future Finance Bills will therefore also provide us with additional opportunities to incrementally improve the fiscal policy and regulatory/legal environment in order to further strengthen our domestic capital market, and ultimately ensure sustained and inclusive growth and development"

SOURCE: https://www.trendingaccounting.com/2020/01/new-vat-implementation-to-take-effect.html