Total product taxes in the economy increased by 112.02 percent, from N1.43 trillion in 2019 to N3.03 trillion in 2022, concurrent with an increase in the value-added tax from 5% in 2020 to 7.5 percent in 2022.
The NBS defines net taxes on products as “total taxes payable on products, minus any subsidies received for the product.”
Net taxes on goods in 2019 totaled N1.43 trillion before the new VAT system went into effect. The new VAT regime started in 2020, hence taxes increased by 34.97% to $1.93 trillion by that year. Additionally, it increased by 32.13 percent to N2.55 trillion in 2021 and by 18.88 percent to N3.03 trillion in 2022.
Commenting on the rise in product net taxes, the NBS said, “On a year-on-year basis, Net Taxes on Products grew in real terms by 10.30 per cent in Q3 of 2022, and 11.18 per cent in Q4 of 2022 compared to 6.22 per cent and 67.99 per cent in Q3, and Q4 of 2021.”