VATLive > Blog > VAT > Nigeria raises VAT to 7.5% 2020

Nigeria raises VAT to 7.5% 2020

  • VAT
  • Sep 12, 2019 | Richard Asquith

The Nigerian government has proposed raising the Value Added Tax standard rate from 5% to 7.5%. The rise will need the agreement of the National Assembly, states and local government. The federal government only retains 15% of VAT - the balance goes to the 36 states and local government. The increase will likely be put into place on 1stJanuary 2020. 

The increase is required to help reduced the government deficit as oil prices remain subdued. Oil accounts for 90% of foeign currency earnings in the country. The country has struggled to finance debt servicing costs. Nigeria has just announced plans to implement VAT on foreign e-commerce business selling to local consumers.

The average African VAT rate is 16%. 

VP Global Indirect Tax
Richard Asquith
VP Global Indirect Tax Richard Asquith
Richard Asquith is VP Global Indirect Tax at Avalara, helping businesses understand their compliance obligations as they grow globally. He is part of the European leadership team which this year won International Tax Review's Tax Technology Firm of the Year. Richard qualified as an accountant with KPMG in the UK, and went on to work in Hungary, Russia and France with EY.
VATlive newsletter

Sign up for our free newsletter stay up-to-date with the latest tax news.

VAT Voice

Sign-up to VAT Voice, Avalara’s monthly round-up about VAT and legislation updates to help you stay ahead of the curve.