FG INAUGURATES COMMITTEE TO DRAFT NEW VAT ORDER

FG INAUGURATES COMMITTEE TO DRAFT NEW VAT ORDER

…Panel Gets Six Weeks to Align VAT Framework with Tax Reform Acts

The Federal Government has inaugurated an Inter-Ministerial Committee to develop a new Value Added Tax (VAT) Modification Order aimed at supporting the implementation of Nigeria’s Tax Reform Acts that came into effect on January 1, 2026.

The Minister of Finance and Coordinating Minister of the Economy inaugurated the committee at the Federal Ministry of Finance headquarters in Abuja, describing the Tax Reform Acts as the most comprehensive overhaul of Nigeria’s tax system in decades.

The Minister said the reforms were designed to simplify tax laws, improve certainty, enhance competitiveness, protect vulnerable Nigerians and position the economy for sustainable growth. He noted that although the previous VAT Modification Order had been superseded by the new legislation, the committee’s responsibility was not to replicate the old framework but to develop a modern, coherent and forward-looking VAT Modification Order that complements the new law and supports economic transformation.

According to the Minister, the committee has been mandated to review the country’s existing VAT administration framework, identify areas requiring clarification, engage stakeholders from both the public and private sectors, develop comprehensive lists of VAT-exempt and zero-rated supplies, draft a workable VAT Modification Order and recommend legislative amendments where necessary.

He explained that the committee’s work would be guided by five key principles: fidelity to the law, growth-oriented design, clarity and certainty, broad stakeholder engagement and international benchmarking.

The Minister stressed that the new VAT framework should encourage industrialisation, investment, exports, innovation, food security and energy transition without compromising the integrity of the tax system.

The committee has been given a maximum of six weeks to complete its assignment and submit a Draft VAT Modification Order 2026, schedules of exempt and zero-rated supplies with corresponding Harmonised System (HS) Codes, implementation notes and a stakeholder consultation report.

The committee comprises representatives of the Federal Ministry of Finance, Nigeria Revenue Service, Nigeria Customs Service, Federal Ministry of Industry, Trade and Investment, Joint Revenue Board, Manufacturers Association of Nigeria, Tax Advisory Committee and the Tax Justice and Governance Platform.

In a statement issued by the Federal Ministry of Finance, the Minister expressed confidence that the committee’s diverse membership would provide the expertise required to deliver a VAT framework capable of supporting Nigeria’s economic growth and tax administration objectives.