7.5% VAT: Electricity transactions to rise from Feb 1

There are indications that power distribution firms across the country plan to reflect the new Value Added Tax of 7.5 per cent on all their transactions from February 1, as announced by the Federal Government.

Already, Ibadan Electricity Distribution Company confirmed this on Monday, saying it would implement an upward review in the prices of meters sold to customers under the Meter Asset provider scheme introduced in 2019.

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Head, Branding and Corporate Communication at IBEDC, Mrs Angela Olarenwaju, made the disclosure in a statement made available to our correspondent on Monday.

Olarewaju said that the management’s decision on the review was necessitated by the Federal Government’s increase in the value added tax from five per cent to 7.5 per cent.

Following this, she said, a single-phase meter which used to cost N38, 325 (VAT inclusive) would now cost N39, 237.50 (VAT inclusive).

Similarly, a three-phase meter which used to cost N70, 350 (VAT inclusive) will now costs N72, 025.00 (VAT inclusive).

The IBEDC spokesperson said that subsequently, the meter service charge on MAP payment by instalment would also be reviewed to accommodate the new VAT charge.

IBEDC management pointed out that VAT on tariffs had been adjusted to accommodate the new 7.5 per cent rate.

Author: abokimallamfx