The Federal Government has implemented a 7.5 per cent tax on imported Liquefied Petroleum Gas, popularly called cooking gas, as the cost of the commodity leap by over 100 per cent within a period of eight months.
It was gathered that the government implemented the VAT on LPG imports about three weeks ago and some dealers were also mandated to pay the tax for commodities imported several months ago.
Operators said that Nigeria imports about 70 per cent of the commodity, while the rest was mainly supplied by the Nigeria Liquefied Natural Gas company.
It was also gathered that the cost of a 12.5kg of cooking gas that sold for about N3,500 in December 2020 had jumped to as high as N6,800 in parts of Abuja.
Operators stated the development had made small businesses and homes in rural and semi-urban areas to revert to firewood and charcoal, as the purchase of cooking gas had plunged in recent months.
The National Chairman, Liquefied Petroleum Gas Retailers Association of Nigeria, Michael Umudu, said there were three factors that caused the surge in price.
About 70 per cent of the gas consumed in Nigeria is imported and importers have to contend with the high cost of foreign exchange. Secondly, there is a rise in the price of petroleum products in the international market and thirdly, the government added VAT on imported LPG about three weeks ago.