IMF Chief Calls on Nigeria to Raise VAT as Budget Strained

Nigerian authorities should consider raising value-added taxes and removing fuel subsidies to boost revenue and compensate for a plunge in oil prices, International Monetary Fund Managing Director Christine Lagarde said.

“Hard decisions will need to be taken on revenue, expenditure, debt and investment going forward,” she said in a speech to lawmakers in the capital, Abuja, on Wednesday. The government must “act with resolve by stepping up revenue mobilization,” she said, and possibly raise the VAT rate from 5 percent, which is among the lowest in the world.