House of Reps rejects a motion to suspend the implementation of 7.5% VAT rate

The House of Representatives on June 2, 2020 rejected a motion sponsored by Honourable Unyime Idem (PDP, Akwa Ibom), seeking to suspend implementation of the 7.5% Value Added Tax (VAT) rate introduced by the Finance Act 2019 till January 2021, due to impacts of the COVID-19 pandemic.

The sponsor noted that due to the pandemic, resulting in lockdown and bank on inter-state movements by the Government, prices of goods and services are on the increase, thereby negatively affecting the livelihood of the citizens.

The opposing lawmakers posited that since the increment in the VAT rate has already been passed by the National Assembly and signed into law, it cannot be suspended by a motion. The Chairman of the House Committee on Finance, James Faleke drew attention of the House to the fact that since the issue contained in the motion affects an existing law, it will be out of place to suspend it with just a motion.

The Speaker Femi Gbajabiamila, who agreed with Faleke, said the issue contained in the motion has a commencement date, which can only be altered through a formal amendment bill.

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