The Manufacturers Association of Nigeria (MAN) has commended the Federal Government’s announcement of 7.5 per cent Value Added Tax (VAT) waiver on Automotive Gas Oil (AGO), cfommonly called diesel.
On Monday, Segun Ajayi-Kadir, the Director General, MAN, via a statement, described the development as a positive outcome for the real sector.
The MAN DG noted that the tax waiver had formed part of the reconciliation that the association and other members of the Organised Private Sector of Nigeria had sought.
According to him, they had earlier called on government and the Labour unions to use their best endeavours to find common grounds to avoid plunging the economy into crisis.
“We already have enough challenges and the manufacturing sector in particular, is operating on the brink of a recession.
“You would also recall that MAN had stridently advocated for the removal of the VAT on diesel, especially because it has actually become a major “input” into our production process.
“We rely on diesel to power our machines and meet our energy needs in the face of abysmal power supply from the national grid.
“You are also aware that the price has gone above N1,000 per liter. Meanwhile, it is said that diesel is used to fuel about 90 per cent of the haulage trucks that transports petrol from the depots to retail outlets nationwide.
Ajayi-Kadir, however, expressed concerns over the six months time frame scheduled for the tax waiver, querying if there would likely be a more permanent and impactful remedy to the problem.
He also emphasised the need to have an expansion of the joint committee to be set up to include stakeholders in the economic landscape.
