The Minister of Finance, Budget and National Planning, Zainab Ahmed, has dismissed insinuations that Nigeria will adjust her crude oil price projections in the 2020 budget.
Following the bombings on oil installations in Saudi Arabia, crude oil prices surged to about $70 per barrel.
However, the minister said the Federal Government would not be in a hurry to make adjustments from the $55 per barrel benchmark in the proposed 2020 budget.
Zainab made this known while responding to questions from newsmen at a press briefing for an upcoming event in Abuja.
“The fact that crude oil prices have surged doesn’t mean that we should be in a haste to review our oil benchmark upwards. It will be a situation that will be closely monitored.
“In fact, we should not rejoice over the misfortunes of others. If Saudi Arabia with sophisticated oil installations can be attacked, then we too are also vulnerable. Therefore, it is a situation we will be closely monitoring,” she added.
Also responding to the recently proposed hike in Value Added Tax to 7.5 per cent, the minister clarified that the hike exempts food items, medicine and education.
“VAT is only for luxury goods. When you buy food items in the market and cook in your house, you’re not paying VAT; but when you go to an eatery, you will pay VAT because the owner of the restaurant has added value to the food you’re eating.
“Due to the fierce fiscal finances being faced by the Federal Government and the need to implement the minimum wage speedily, the Federal Government increased the VAT following recommendations by an advisory committee, which was headed by the Chief Executive Officer of Financial Derivatives, Bismarck Rewane.
“It is also important to note that the Federal Government only takes 15 per cent of VAT, while state governments take 85 per cent because their fiscal crisis is even worse,” she explained.