African nations are targeting to invest $1 trillion over the next 10 years to bridge the worrisome infrastructure gap on the continent.
This is as the Executive Chairman of the Federal Inland Revenue Service
(FIRS), Mr Tunde Fowler revealed that effective 2020, Nigerian banks will commence charging Value Added Tax (VAT) on local and foreign transactions.
The infrastructure funding, which will spring from a plethora of onshore and offshore investors will see the continent extracting its Value Added Tax (VAT) from the investments to address other concerns.
The Executive Secretary, African Tax Administration Forum (ATAF), Mr Logan Wort made the disclosure in Abuja on Monday at the opening of a three-day ATAF technical workshop on VAT.
According to him, Africa loses billions of dollars annually to investors who take advantage of the vacuous tax system on the continent to default in their obligation.
He said there was an urgent need for African countries to share ideas and techniques on how best to administer VAT, designing VAT systems and auditing thereof.
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He said: “Over a $trillion dollars is slated for investment towards infrastructure development over the next 10 years. I mention this because the continent is filled with new developments, high rising buildings and construction projects. The ATAF VAT Technical Committee has noted these developments and commenced work on guidance on VAT issues arising from the construction sector.
“The 2018 edition of Deloitte’s Africa Construction Trends report indicated that as of June 2018, Africa had 482 projects, each valued at US$50 million or above. In total these construction projects were valued at US$471 billion. This was an increase of 53% of the total value of US$307 billion recorded in 2017.
“In 2018, the top three countries in terms of construction projects were Egypt, South Africa and Nigeria. Egypt had the highest recorded number of projects, totalling 46 and accounting for 9.5% of African projects.