The Human Rights Writers Association of Nigeria (HURIWA) has condemned the Federal Government’s plan to increase the Value-Added Tax (VAT) from 7.5% to 10%. HURIWA accuses the administration of adhering to directives from foreign institutions such as the International Monetary Fund (IMF) and World Bank. HURIWA argues that this move will exacerbate many Nigerians’ already dire economic situation.
Criticism of VAT Increase
In a statement released on September 8, 2024, HURIWA National Coordinator Emmanuel Onwubiko criticized the proposed VAT hike as a measure that will deepen Nigerians’ financial strain. He warned that the increase could lead to widespread unrest among a populace suffering from severe economic hardships.
Onwubiko pointed out that the tax increase is part of a series of financial measures that have negatively impacted ordinary Nigerians. Since the removal of fuel subsidies, petrol prices have surged by over 200%, which has a ripple effect on transportation, food prices, and other essential commodities. This has made it increasingly difficult for the average Nigerian, especially those in low-income brackets, to afford necessities.
Call for Policy Reversal
HURIWA has called for an immediate reversal of the VAT hike and other fiscal measures it describes as “suffocating” for the populace. Onwubiko emphasized that 133 million Nigerians, or 63% of the population, live in multidimensional poverty, underscoring the need for policies that alleviate economic strain rather than exacerbate it.
“The VAT increment is just one in a series of damaging financial measures. The government makes choices that benefit international financial institutions but leave the Nigerian people worse off. The well-being of citizens is being sacrificed for economic targets dictated by foreign entities,” Onwubiko said.
He criticized the government for following the advice of foreign institutions without considering local realities and Nigerians’ socio-economic conditions. HURIWA also highlighted the negative impact of inflation on the housing sector, noting that rising costs have led to increased rents, pushing many citizens toward the brink of homelessness.
Tax Reform Initiative
The federal government’s tax reform initiative, which includes the proposed VAT increase, was launched following President Bola Tinubu’s establishment of a tax and fiscal policy committee in August 2023. The committee, headed by tax expert Taiwo Oyedele, is tasked with creating a new tax framework to drive economic growth and development.
The committee’s proposals include increasing the VAT and introducing tax exemptions for low-income earners, among other measures.
HURIWA urged the government to prioritize the well-being of its citizens over foreign directives. The group called for a reevaluation of policies that increase the cost of living and demanded measures that support and uplift ordinary Nigerians rather than further impoverishing them.
