Electricity consumers to pay more for prepaid meters
by Lawal SherifatKindly Share This Story:
As 7.5 % hike in VAT begins Feb.1
Electricity Consumers will have to pay more for prepaid meters as the hike in Federal Government’s Value Added Tax, VAT, from 5 to 7.5 per cent, begins from February 1, this year.
An investigation by Vanguard showed that the Electricity Distribution Companies, DISCOs, have already communicated this to consumers nationwide.
For instance, in a message to its customers, obtained by Vanguard, the Abuja Electricity Distribution Company, AEDC, stated: “Please be informed that the new VAT of 7.5 per cent will from 1st February 2020, be reflected in all our services (electricity bills and cost of the meter under MAP).
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“This is in compliance with the directive from the Federal Government. Customers are to note that VAT is only applied to the aggregate cost of energy consumed by the customer per time and cost of the meter and not an increase in the unit cost of electricity or meter.”
The company stated that the total cost of a three-phase prepaid meter will increase by additional N5, 029.19, from the current N67, 055.85 to N72, 085.04, when the new VAT rate becomes operational.
In another message to its customers, Port Harcourt Electricity Distribution Company, PHED, also stated: “This is to notify all PHED customers that following the recent increase in VAT introduced by the Federal Government, prices for prepaid meters have been reviewed to reflect current realities.”
It added: “The new prices take effect from February 1, 2020, as indicated by the new directive.”
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The Federal Government had proposed an increase of VAT from 5 to 7.5 per cent towards the end of last year, to enable it to generate additional funds for the funding of the 2020 budget.
The Minister of Finance, Budget and National Planning, Mrs. Zainab Ahmed, who disclosed this while briefing State House Correspondents after the Federal Executive Council, FEC meeting presided over by President Muhammadu Buhari at the Council Chamber, Presidential Villa, Abuja, had said: “Our projection is to finish consultations early enough so that it takes effect in 2020.”
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