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MAN advise FG not go-ahead with VAT increase


By Charles Nwaoguji

The Manufacturers Association of Nigeria (MAN) has advised Federal government not go –ahead with increase in Value Added Tax (VAT) plan as this would affect the manufacturers and common men in the street.

The President of MAN,  Engr. Mansur Ahmed, said such move by the government would be counterproductive, especially in the light of the still awaited minimum wage.

Ahmed, who stated this  at the association’s 48th Annual General Meeting held recent in Lagos. said that just last week, the Federal Executive Council went ahead and approved the increase in VAT from 5 percent to 7.2 percent, which is subject to National Assembly approval and stakeholders’ engagement amendment of the VAT act.

He called on the government  to address the numerous challenges in the tax system and the results of that engagement is been felt in the business environment today.

Also, speaking at the event, the Chairman, MAN Apapa branch, Mr. Frank Onyebu commended the federal government on its new policy that restricts provision of foreign exchange, forex, for food importation.

Onyebu, however, stressed the need for the government to provide further clarification on the items it is imposing restriction on to ensure that items that form inputs for manufacturers are excluded from the list.

He lamented the sluggishness of the manufacturing sector and its contribution to the Gross Domestic Product, GDP, saying that the sector has remained stunted despite government’s effort at repositioning the sector via reforms.

Onyebu noted that sourcing forex for importation by manufacturers has also remained a challenge in the country.

“Challenges range from funding, especially long-term funds, high interest rate, foreign exchange availability, poor support infrastructure, multiple taxes and levies,” he said.

Others, according to him, include policy somersaults, absence of core industries that would produce raw materials, insecurity, inadequacy of support systems to encourage the growth of small and medium scale industries.

Speaking on the theme: “Providing Sustainable Infrastructure: The Basis for a Nation’s Growth”, he said that the manufacturing sector has had to cope with dilapidated access roads, poor electricity supply and over-regulation by regulatory agencies and called on the government to deploy more resources towards permanently eliminating the gridlock along Mile 2 to Tin-Can/Apapa Express-way.

“We also plead for government’s intervention in the rehabilitation of the road networks within the Amuwo-Odofin and Kirikiri industrial areas and the Apapa/Tin-Can Island Ports axis,” he added.

Lagos State governor, Mr. Babajide Sanwo-Olu, speaking at the event, said: “We are aware that the provision of needed infrastructure, especially in the areas of power and roads, water and rail inclusive, among others, have not reached the desired level that will meet our aspirations.

“However, I can assure you that we are focused on the delivery on our promise with the knowledge that achieving a 21st century economy will only remain a mirage without putting world class infrastructure befitting the 56th largest economy in Africa in place,” he added.


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