Trade Union Congress of Nigeria Rejects Proposed VAT Hike


By Adakoriko Adaviriku Adumaza

The Trade Union Congress of Nigeria (TUC) has vehemently opposed the Federal Government's proposal to increase the Value Added Tax (VAT) rate, citing its potential to exacerbate the economic challenges faced by Nigerians.

The proposed phased VAT hike, outlined in the Federal Government's Tax Reform Bills, seeks to raise the current rate of 7.5% to 10%, 12.5%, and ultimately 15%. However, the TUC described the plan as ill-timed and detrimental to the welfare of citizens already struggling with inflation, unemployment, and rising living costs.

TUC President Festus Osifo emphasized the importance of maintaining the VAT rate at 7.5% to safeguard households and businesses from additional financial strain. "Allowing the Value Added Tax rate to remain at 7.5 per cent is in the best interest of the nation," Osifo stated.

Key Concerns and Recommendations:

VAT Rate Increase: The TUC rejects the proposed VAT hike, citing its potential to worsen economic challenges.
Tax Exemption Threshold: The union advocates for an increase in the tax exemption threshold from N800,000 to N2.5 million per annum to provide relief for low-income earners.
Royalty Collection: The TUC expresses concerns about the proposal to transfer royalty collection from the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) to the Nigeria Revenue Service (NRS), warning that it could lead to revenue losses and inefficiencies.
Tax Policies: The union urges the Federal Government to adopt tax policies that prioritize citizens' welfare and promote equitable economic growth.

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