Connect with us

Headlines

Nigerian govt yet to implement VAT on imported LPG — Marketers

Published

on

Nigerian govt yet to implement VAT on imported LPG — Marketers

The Federal Government has yet to implement the payment of Value Added Tax, VAT, on imported Liquefied Petroleum Gas (LPG), reports the Nigerian News Agency.

LPG, also known as cooking gas traders, confirmed the development to NAN on Monday in Lagos as it reacted to the drop in the price of the product across the country.

The government had published in 2019 the elimination of VAT on LPG to increase its national use.

However, in July 2021, marketers were notified about the reintroduction of VAT on the product when the government moved to shore up their sources of income.

Bassey Essien, Executive Secretary of the Nigerian Association of Liquefied Petroleum Gas Traders, NALPGAM, urged the government to urgently clarify its position on the issue.

“The announcement that the government was reintroducing VAT on imported LPG generated panic in the market that led to the spike we experienced in cooking gas prices in 2021.

“Some traders stopped importing and don’t forget that around 60 percent of the LPG consumed in Nigeria is imported.

“The NLNG only supplies around 450,000 MT and our LPG consumption exceeds one million metric tons, so the imposition of VAT on imported LPG affected the market.

“However, the government has not yet started collecting VAT despite the announcement that has encouraged more traders to restart importing.”

He said the shock currently felt as if cooking gas prices had dropped from about N10,000 and N10,500 for a 12.5 kg gas cylinder to about N7,400 and N9000 across the country.

According to Mr. Essien, the supply has increased and as it continues prices will continue to fall, but it is still a long way from where we came from.

“In January 2021, a 20 metric ton truck cost around 4 million naira, but is currently around 9.7 million naira.

“We have to look at all the factors that drove prices, including the demand for LPG in the international market, and find a way to tame the supply of LPG to ensure price stability.”

In addition, Michael Umudu, National President, Liquefied Petroleum Gas Retailers (LPGAR), branch of the National Union of Petroleum and Natural Gas Workers (NUPENG), said that the drop in cooking gas prices was a positive development.

Mr Umudu said: “We as retailers suffered a lot because many of our customers switched to charcoal and firewood because they could no longer afford to buy gas.

“Now, the supply is increasing and we hope that if it continues, there will be a further reduction in the price of cooking gas.

“We learned that the government has not implemented the VAT policy but the pressure that the pronouncement brought to the industry led to the rise in the price of LPG.

“We want the government to openly say that they have eliminated VAT on imported LPG so that there is stability.”

He stressed the need for the government to encourage more Nigerians to adopt gas because of the health benefits it brings to the nation.

“The government has announced many policies aimed at deepening gas use, such as the Decade for Gas Development initiative and the National Gas Expansion Program.

“However, these programs must be viable and not just on paper. There needs to be infrastructure on the ground to support its implementation, ” Umudu added.

YAYA

Short Link: https://wp.me/pcj2iU-3GDW

NNN is a Nigerian online news portal that publishes breaking news in Nigeria, and across the world. We are honest, fair, accurate, thorough and courageous in gathering, reporting and interpreting news in the best interest of the public, because truth is the cornerstone of journalism and we strive diligently to ascertain the truth in every news report. Contact: editor @ nnn.ng. Disclaimer.