VAT removed from renewable energy: President Bola Tinubu has announced that rent, public transportation, and renewable energy will be completely exempt from paying Value Added Tax (VAT).
In his statement marking his second anniversary in office, the President explained that this decision aims to ease the financial burden on households. He also noted that essential goods such as food, education, and healthcare will now be subject to 0% VAT.
In his words:
“One of our administration’s most impactful achievements is our bold tax reform agenda, which is already yielding results. By the end of 2024, our tax-to-GDP ratio increased from 10% to over 13.5%, a remarkable rise in just one year. This was not by accident. It stems from deliberate improvements in tax administration and policies designed to make our tax system fairer, more efficient, and growth-oriented.
We are removing the burden of multiple taxation, making it easier for small businesses to grow and join the formal economy. These reforms will protect low-income households and support workers by increasing their disposable income. Essential goods and services such as food, education, and healthcare will now attract 0% VAT. Rent, public transportation, and renewable energy will be fully exempt from VAT to further reduce household costs.
We are ending the era of wasteful and opaque tax waivers. Instead, we have introduced targeted and transparent incentives supporting high-impact sectors like manufacturing, technology, and agriculture. These reforms are not just about revenue but about stimulating inclusive economic growth.
Still on VAT removed from renewable energy
There is a clear focus on our youth, with a friendlier tax environment for digital jobs and remote work to empower them. Through export incentives, Nigerian businesses will be better positioned to compete globally. Our National Single Window project streamlines international trade, reduces delays, and enhances Nigeria’s competitiveness.
To promote fairness and accountability, we are establishing a Tax Ombudsman, an independent body that will protect vulnerable taxpayers and ensure the system works for everyone, especially small businesses.
Most importantly, we are laying the foundation for a sustainable future by introducing a new national fiscal policy. This strategic framework will guide our approach to fair taxation, responsible borrowing, and disciplined spending.
These reforms are designed to reduce the cost of living, promote economic justice, and build a business-friendly economy that attracts investment and supports every Nigerian. Together, we are creating a system where prosperity is shared, and no one is left behind.”
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