The list of zero-rated items includes essential goods and services such as basic food items, medicine, educational books, electricity, and tuition fees. Zero-rating means that while consumers pay 0% VAT, the producers can still reclaim any input VAT they paid on their own costs.
- Scenario: A hospital that buys a piece of medical equipment for ₦10 million pays no VAT on the purchase. Furthermore, it can reclaim any VAT it paid on other inputs, making healthcare more affordable.
