The Minister of Budget and National Planning, Senator Udo Udoma, said on Tuesday that the Federal Government is considering increasing Value Added Tax, to enable it fund the N30,000 new national minimum wage that was approved today by the Senate.
Earlier today, the Senate had approved N30,000 as the new national minimum wage after a decision was reached at the upper chamber’s ad-hoc committee on new minimum wage headed by Senator Francis Alimikhenn.
The Senator representing Benue Northeast Senatorial district, Barnabas Gemade had insisted that states have enough resources to pay minimum wage. He said that no governor in the states of the federation should complain overpayment of N30,000 minimum wage.
Gamade faulted those governors complaining of inadequate resources, adding that if resources available to states were prudently managed, payment of wages would be easy.
The lawmaker further explained that candidates including state governors spent humongous resources buying votes in the just-concluded elections, claiming that it was the state resources governors use for their elections. He said:
“There is no state in the country that cannot pay the N30,000 National minimum wage. They have enough resources to pay.
“I saw in the just concluded elections how votes were massively bought by the state resources and nobody should tell Nigerians that they cannot pay. They should pay.”
However, the Minister of Budget and National Planning, Senator Udo Udoma, has come out to say that the only way the Federal Government can fund the new minimum wage is by increasing Value Added Tax.
Udoma stated this on Tuesday while appearing before the Senate Committee on Finance.
The Minister also told the panel headed by Senator John Owan-Enoh, that the Technical Advisory Committee on the minimum wage, will submit its report to President Muhammadu Buhari this week. He said:
“The current minimum wage of N18,000 is really too low. It is difficult for workers to manage on that amount.
“The President supported a review, but it is important that as we are revising it, we should be able to fund it.
“It is in the light of this that we would be coming to you (Senate) because there may be the need to make some changes, especially the VAT, in order to fund the minimum wage once it is announced.”