The Federal Government had said it would from today begin the implementation of the 7.5 per cent Value Added Tax.
The VAT increase which is meant to help government achieve its revenue projections for the 2020 budget is a part of the tax reforms included in the 2019 Finance Act .
With the Act , it is expected that there will be more revenue to finance key government projects especially in the areas of health, education and critical infrastructure.
Among the Finance Act strategic objectives is the supporting of micro , small and medium Enterprises in line with the ease of doing business reforms such as VAT threshold.
Speaking during a breakfast programme on the Nigerian Television Authority monitored by our correspondent , the Executive Chairman of the FIRS , Mohammed Nami, urged all businesses to ensure that they register with the FIRS for VAT purpose .
He said any business that failed to obey the tax law would face the wrath of the tax authorities.
He said, “ It’s your statutory responsibility whether you just registered today with Corporate Affairs Commission to come over to the Federal Inland Revenue to register as VAT agent. That is the first responsibility .
“The second responsibility is that you should keep good record of your transaction because if you don’t keep good records and eventually during the compliance process and monitoring process it is discovered that you have traded well above N25m , the taxes will be paid in arrears . ”
He said the VAT Act already exempts pharmaceuticals , educational items , and basic commodities.
Some of the basic food commodities according to Section 46, that were also excepted include brown and white bread; cereals including maize, rice, wheat , millet, barley and sorghum and fish of all kinds.
Others are flour and starch meals; fruits, nuts, pulses and vegetables of various kinds; roots such as yam, cocoyam, sweet and Irish potatoes; meat and poultry products including eggs ; milk ; salt and herbs of various kinds; and natural water and table water.