The Federal Government, on Monday 19th June 2023, has commenced implementation of the payment of 7.5 percent Value Added Tax on Automotive Gas Oil, also called diesel.
This was disclosed by the Nigeria Customs and the Federal Inland Revenue Service, stating that diesel was not exempted from the payment of VAT based on VAT modification Order 2021.
In a letter to Oil marketers, signed by the Assistant Comptroller-General,Tariff and Trade, Mba Musa, he disclosed that the Federal Inland Revenue Service, FIRS has directed the Nigeria Customs Service, NCS Â to begin charging a 7.5 percent Value-added Tax payment for diesel import.
 “I am directed to forward a letter from Federal Inland Revenue Service on the above subject matter. The VAT Modification order 2021 only exempts petroleum products of HS codes 2709.00.00.00 – 2710.19.12.00 from VAT payment. AGO or diesel falls classifiable under HS Code 2710.19.21.00 and is not exempted from paying VAT. “Subsequent upon the above, all future product importations should assess and pay VAT at the point of entry into the country. Also, note that AGO or diesel are not exempted from destination inspection or import guidelines and are expected to process Form M and PAAR and make declarations appropriately in the NICIS II system.
This latest development comes after the Federal Government stopped the payment of subsidy on Premium Motor Spirit PMS, also known as petrol, pushing the pump price to N500 per litre from N185 per litre.
Story:Justina Egye