Nigeria has hit zero revenues from surcharge on luxury item a tax that was introduced in 2015.
This is according to a release from Budget Office, based on data from the 2019 Budget implementation report.
The government had budgeted a tax revenue of N2.5 billion in the 2019 budget.
Recall that zero taxes were equally collected in the 2018 fiscal year based on the published data.
Business Hallmark’s findings show that there is no published data for 2017 and 2016. A sum of N2.5 billion was also budgeted in 2018.
The administration of former president Goodluck Jonathan in 2014 initiated plans to introduce luxury taxes as an initiative targeted at increasing government’s tax revenue. The taxes targeted luxury taxes on items such as private jets, luxury yachts, luxury cars, business class/first class tickets on airlines and other major items typically purchased by the rich.
According to a PWC report seen by this newspaper, following rates applied to taxes for luxury items; 0% import surcharge on new private jets; 39% import surcharge on luxury yachts; 5% import surcharge on luxury cars; undisclosed surcharge on business and first
class plane tickets; 3% luxury surcharge on champagnes; wines and spirits; and a 1% Federal Capital Territory (FCT) mansion tax on residential properties valued at N300Bmillion and above.
During this period that the tax was being promoted, the Nigerian government had banked on a tax revenue of N480 billion in 3 years the PWC report reveals.