Tuesday, 05 November, 2024

More agony as Nigerians to pay 7.5% VAT on diesel


The payment of the 7.5% Value Added Tax on Automotive Gas Oil, also known as diesel, was officially announced by the Federal Government on Monday.

In Abuja, representatives of the Federal Inland Revenue Service and the Nigerian Customs Service reaffirmed that AGO was not exempt from paying VAT in accordance with the VAT Modification Order 2021.

The development was, however, condemned by Nigerians, who pointed out that citizens were still trying to adjust to the hike in the pump price of Premium Motor Spirit, popularly called petrol, not knowing that plans had been perfected to further raise payments for diesel.

Also Read: Nigeriaā€™s inflation rate rise more than 60 time in a decade under Emefiele

Abdullahi Maiwada, spokesman of the NCS, confirmed this increased during a press briefing, noting that the NCS was now collecting 7.5 per cent VAT on the imports of AGO.

He said, ā€œIf you ask me whether Customs collect 7.5 per cent VAT on AGO, I will tell you yes and Iā€™ll give you the reasons. Thereā€™s what we call VAT Modification Order 2021, which exempts petroleum products of Harmonised System Codes.

ā€œBut the HS Codes for Petroleum products that are exempted from paying VAT are those in the region of 2709.00.00.00 ā€“ 2710.19.12.00. The HS Codes are what we use to classify commodities. But AGO is classified under HS Code 2710.19.21.00, which is not exempted from the payment of VAT. Now, this is based on the VAT Modification Order 2021.ā€

In a letter from the NCS to some of its personnel, on the matter, with reference: NCS/T&T/T/899/217/VOL.I, sighted in Abuja, and dated June 8, 2023, the service made it clear that VAT must be paid on diesel.

The letter was signed by the Assistant Comptroller-General (Tariff and Trade), Mba Musa, on behalf of the Deputy Comptroller-General (Taritf and Trade).

It read in part, ā€œI am directed to forward a letter from Federal Inland Revenue Service on the above subject matter. The VAT Modification order 2021 only exempts petroleum products of HS codes 2709.00.00.00 ā€“ 2710.19.12.00 from payment of VAT. AGO or diesel falls classifiable under HS Code 2710.19.21.00 and is not exempted from paying VAT.

ā€œSubsequent upon the above, all future importations of the product should assess and pay VAT at the point of entry into the country. Also note that AGO or diesel are not exempted from destination inspection or import guidelines and as such are expected to process Form M and PAAR as well as make declarations appropriately in the NICIS II system.

ā€œA copy of the letter from FIRS is attached for your information. Take note and be guided accordingly, please.ā€


Discover more from News Round The Clock

Subscribe to get the latest posts sent to your email.

Join The Conversation

Join Our Mailing List

Nigerian Wedding – Dolapo + Jide ā¤ļøšŸ’

GROCERIES CATEGORY

Premier League Table

The Super Eagles at the FIFA World Cup (1994-2018)

Follow NRTC on Twitter

Discover more from News Round The Clock

Subscribe now to keep reading and get access to the full archive.

Continue reading