VATs On Coke, Pepsi, Energy Drinks, Other Luxury Items To Rise

Federal Government is working on modalities to increase the Value Added Tax on some select items which include carbonated drinks and other luxury items in 2019.

Beverages like Coke, Pepsi, and energy drinks may be affected.

Minister of Finance, Mrs Zainab Ahmed, stated this on Wednesday at the inauguration of the Strategic Revenue Growth Initiative.

Ahmed said the Federal Executive Council will take a request to the National Assembly for an amendment of the VAT law.

“There will be a VAT increase. During the course of 2019, we will have clarity as to which items and what the rate will be and we will have to take a request to the National Assembly for amendment before it takes effect,” she said.

The Finance Minister noted that Nigeria is facing a huge fiscal challenge to meet up with infrastructural development as the population continues to grow.

She said the increase will help the government in providing infrastructure for its people.

In December 2016, the FG raised duties on luxury goods and beverages imported into the country under the Economic Community of West Africa’s (ECOWAS) Common External Tariff (CET) regime.

The increase was 10 to 70 per cent the value of imported yachts, luxury automobiles such as SUVs, boats, and alcoholic beverages.

Other affected items include antimalarial and antibiotics; crude palm oil; wheat flour; tomatoes paste; and cassava products among others.

Last year, it also raised excise duty rates for alcoholic beverages and tobacco to reduce health hazards.