NARTO Calls on Federal Government to Halt VAT on Diesel

The Nigerian Association of Road Transport Owners (NARTO) has raised concerns over the 7.5% Value Added Tax (VAT) on Automotive Gas Oil (diesel), urging the Federal Government to halt the VAT to avoid disruptions in the distribution and supply of Premium Motor Spirit (petrol).

NARTO highlights the importance of diesel in fueling approximately 90% of haulage trucks that transport petrol from depots in the South to various filling stations across Nigeria. The association emphasizes that before the introduction of VAT on diesel, the cost of the commodity was around N600 per litre. However, the price has surged to almost N1,000 per litre, significantly increasing the cost of transporting petrol.

Transporters are facing significant challenges due to the high cost of diesel, compounded by the fact that the government has not allowed an increase in the pump price of petrol. This creates an unsustainable situation for transporters, as they cannot raise their fares to cover the increased costs.

NARTO President, Yusuf Othman, urges the immediate removal of the 7.5% VAT on diesel as a necessary step to address the rising costs. Othman emphasizes that the continued imposition of the VAT on diesel could lead to a shortage of petrol supply as transporters may be forced to park their trucks.

The Federal Government implemented the payment of 7.5% VAT on diesel starting from June 20, 2023. The Customs Service and the Federal Inland Revenue Service confirmed that the VAT was not exempted based on the VAT Modification Order 2021.

The deplorable state of many federal roads exacerbates the challenges faced by transporters. NARTO calls for urgent attention from the government to address these issues. The association insists that the government must consider the removal of the VAT on diesel and reevaluate the pump price of petrol to enable marketers to adjust transportation costs.

By addressing these concerns, the government can ensure a stable supply of petrol and prevent disruptions caused by increased costs. Failure to take immediate action may result in a negative impact on the availability of petroleum products.

It is essential for the government to collaborate with stakeholders, including NARTO, in finding a viable solution to the transportation challenges and the rising costs of diesel. Only through effective cooperation can a sustainable and affordable system be established for the benefit of both transporters and consumers.

Source of content: OOO News 2023-09-13 News

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