In line with the Federal Government’s directive on the Finance Act 2019, the Value Added Tax (VAT) applicable on goods and services offered by Jumia would be increased from 5% to 7.5% effective on the 1st of February 2020.
Examples on how to calculate the VAT increment
Example 1
Let us assume that a vendor wants to purchase a basic sponsored product package (#8500). The VAT calculation is 7.5%, what amount will the vendor pay?
(7.5 X 8500) / 100 = 637.5
= 8500 + 637.5
= 9,137.5
The new amount that the vendor will pay for the above basic sponsored product package is now 9,137.5
Example 2
A vendor is selling a cooling system which falls under the Automobile category with #390 Shipping cost, how much will the new shipping cost be, put into consideration the new 7.5% VAT charges?
(7.5 X 380) / 100 = 28.5
= 380 + 28.5
= 408.5
The new shipping cost will be #408.5
Example 3
If 25 pieces of small branded cartoon packaging material cost #900, how much will it cost if the VAT charge is 7.5%?
(7.5 X 900) / 100 = 67.5
= 900 + 67.5
= 967.5
The cost of the packaging material will be #967.5
