Connect with us

Economy

Budget: Low Revenue Generation Threatens Funds Release

Published

on

USDCAD
  • Budget: Low Revenue Generation Threatens Funds Release

The Federal Government on Tuesday said that the low revenue generation by its Ministries, Departments and Agencies was affecting the implementation of the 2017 budget.

It lamented that with about four months to the end of the year, only 25 per cent or N120bn out of the target of N807bn set for agencies generating revenue only for the Federal Government under the Fiscal Responsibility Act had been realised.

Speaking in Abuja on Tuesday at a workshop on compliance with the Fiscal Responsibility Act, which was organised for senior officers of the MDAs, the Accountant-General of the Federation, Mr. Ahmed Idris, said there was a need for improvement in revenue generation in order to meet the targets set for this year.

Some of the agencies generating revenue for the Federal Government alone under the FRA are the Central Bank of Nigeria, Joint Admissions and Matriculation Board and the Nigerian Maritime Administration and Safety Agency.

Idris lamented that in 2016, the government fixed a revenue target of N1.3tn for the agencies, adding that only 35 per cent of the target was realised.

He said the development made the government to reduce this year’s target to N807bn, with only about 25 per cent so far generated.

Idris stated that the inability of the agencies to meet the expected revenue target had taken its toll on disbursements to the MDAs.

He said, “We only realised 35 per cent of the N1.3tn revenue estimated for 2016. For 2017, it has been lowered to about N807bn and we are now in the third quarter of the year. But what we have been able to realise to date is about N120bn.

“We are now in September, which means we have not even gone half way; we are just hovering around 25 per cent of the estimated revenue for this year as far as Internally Generated Revenue for this year is concerned.”

He added, “We must go back and see what we can use to enhance our revenue generation, otherwise the budget will not be funded and that is why we have gaps in terms of releases. Agencies wonder why certain components of the releases are not made 100 per cent, but this is partly the reason.

“The estimated revenue is not really achieved as expected and therefore the releases could not be made as expected.”

Idris, however, urged the heads of the government agencies to be more creative in revenue generation efforts so that they could meet their individual targets and collectively meet the targeted revenue to fund the budget.

The Minister of Finance, Mrs. Kemi Adeosun, urged government agencies to recognise the current financial priorities of the nation and therefore cut their costs, eliminate wastage and block revenue leakages.

She warned heads of the agencies that under the President Muhammadu Buhari-led administration, the issue of transparency and accountability in the management of government resources would not be compromised.

Adeosun explained that many agencies were engaged in quasi-commercial activities on behalf of the government and were therefore expected to manage those organisations in a manner that would maximise the operating surplus.

She noted that in other countries like the United Kingdom and the United States, government functions such as visa processing, passport issuance, company registration and regulation were major revenue earners.

However, the minister lamented that in Nigeria, many agencies were operating in such a manner that returned minimal funds to the government.

Adeosun said the cause of the dwindling revenue included wastage, illegal recruitments, bloated expenses, loans to employees and use of expensive consultants.

The minister reminded the agencies that a circular had been issued restricting allowable expenses in line with reforms occurring across government business.

She informed the agencies that compliance checks would be undertaken regularly to ensure that all agencies adhered to the new requirements.

Adeosun also commended a number of the agencies that had improved considerably in their revenue remittance to the Consolidated Revenue Fund.

These agencies, according to her, include JAMB, which has remitted over N5bn, and NIMASA, which has significantly improved its remittances.

Adeosun encouraged other agencies to urgently review their operational costs and revenues with a view to increasing remittances to government coffers.

She informed the participants that the Ministry of Finance planned to publish the performance of the agencies.

Is the CEO and Founder of Investors King Limited. He is a seasoned foreign exchange research analyst and a published author on Yahoo Finance, Business Insider, Nasdaq, Entrepreneur.com, Investorplace, and other prominent platforms. With over two decades of experience in global financial markets, Olukoya is well-recognized in the industry.

Continue Reading
Comments

Economy

Gov Aiyedatiwa Signs ₦96 Billion Supplementary Budget Into Law, Hails Ondo House of Assembly For Swift Passage

Published

on

Lucky Aiyedatiwa

The Governor of Ondo State, Lucky Aiyedatiwa, has expressed gratitude to the State House of Assembly for the swift passage of the Supplementary Budget as he signs the ₦96 billion budget into law.

Governor Aiyedatiwa spoke on Tuesday, November 15, during the signing of the supplementary budget in Akure.

The governor explained that the supplementary budget is necessary to help his administration address the economic challenges in the state.

According to him, the new budget signed into law is also essential for the state government to implement the new ₦73,000 minimum wage for civil servants and new employees, as well as for the recruitment of workers in the state.

Aiyedatiwa said, “The supplementary budget is necessary because of the time we are in and the trends of what is happening in the state and country in general; the new minimum wage, subsidy removal, and the recent recruitment of workers.”

Aiyedatiwa stated that his administration was grateful to the leadership and members of the House of Assembly for passing the bill.

He highlighted the harmonious relations between the two arms of the state and reaffirmed that his administration will continue to work with the House of Assembly for the betterment of the Ondo people.

The Speaker of the House of Assembly, Olamide Oladiji, thanked the Governor, stating that the steps taken by his administration have not only transformed the state but also proven the governor’s ability and capacity to deliver on the job ahead.

He expressed optimism that the bill signed into law would positively impact the lives of the citizens.

“These giant strides have not only transformed the state in all facets but have clearly demonstrated your vision, capacity, intellectual ability, zeal, passion, direction, and a clear understanding of the enormous job ahead.

“It is therefore hoped that the implementation of these laws will meaningfully impact the lives of the good people of the state.”

Oladiji pledged the continuous support of the House to Aiyedatiwa’s administration, saying, “I want to, on behalf of my colleagues, assure you, Mr. Governor, of our continuous support and cooperation to ensure the success of this administration.”

Continue Reading

Economy

MEND Tackles Ex-Agitators For Threatening To Bomb Oil Installations In Rivers 

Published

on

pipleline vandalisation

A war of words has ensued between a militant group, the Movement for the Emancipation of the Niger Delta (MEND) and a coalition of ex-agitators over alleged plan to attack oil installations in the region by the latter group.

Following the political crisis rocking Rivers State, a coalition of ex-agitators and fighters in the region under the aegis of Niger Delta Development Force had last week threatened to blow-up oil facilities in the region over what it termed a plot to seize financial allocations meant for local government areas in Rivers State through the courts.

The former warlords dared the Federal Government and the Central Bank of Nigeria, saying if they proceeded in withholding the funds for the state, it would have grave consequences.

Kicking against the threat, MEND’s spokesman, Jomo Gbomo, in a statement on Friday, said it will support security operatives in safeguarding crude oil installations from any attack.

Gbomo also said MEND is not in support of the violence that Rivers State has been experiencing due to the lingering feud between the Minister of the Federal Capital Territory, Nyesom Wike, and his successor and estranged political godson, Siminalayi Fubara.

Describing the attack plan as threat to the economy of the country, Gbomo said it would be most unfortunate for a political dispute between two politicians to cost the state and Nigeria assets that are pivotal to nation’s survival.

Noting that the both feuding political gladiators are sons of the Niger Delta, the spokesman asked those making the threats not to allow themselves be tricked using the present circumstance into carrying arms against the Nigerian state on behalf of any of them, not even for any price.

He said as an Ijaw son, he knows the gains of having an Ijaw man as governor in Rivers, adding that it is an achievement which would not have been possible but for the collaboration of other ethnic groups.

According to him, the current healthy collaboration from the various ethnic groups which produced an Ijaw son as governor was spearheaded by the FCT Minister.

The statement said not only would MEND back the Federal Government in protecting oil facilities, but it would also ensure that the masterminds of the threats to attack oil installations are fished out and meant to face justice.

The MEND spokesman, however, urged the elders and traditional institutions in the region to intervene in the face-off between Governor Fubara and the FCT Minister.

He also urged parties in the festering political crisis to seek judicial redress if peaceful dialogue fails.

 

Continue Reading

Economy

Northern Governors Oppose New VAT Model as FG Defends Tax Reform Bills

Published

on

Value added tax - Investors King

The Federal Government has addressed concerns raised by the Northern Governors’ Forum regarding the proposed tax reform bills before the National Assembly.

Investors King gathered that Governors of 19 Northern States of Nigeria, under the platform of the Northern Governors’ Forum met with the traditional rulers from the region to agree to disagree with the Federal Government’s new value-added tax model.

In a communiqué read by the chairman of the forum, Governor Muhammed Yahaya of Gombe State, the governors strongly opposed the new derivation-based model for Value-Added Tax (VAT) distribution in the new tax reform bills proposed by President Tinubu’s government.

Addressing the governors’ concern, the FG in a statement on Thursday by the President’s Special Adviser on Information and Strategy, Bayo Onanuga stated that the proposed bills will streamline Nigeria’s tax administration processes, enhance efficiency and eliminate redundancies across the country’s tax operations.

According to Onanuga, the bills which is currently before the National Assembly for consideration emerged after extensive review of existing tax laws.

The statement reads, “While we commend the Governors and traditional rulers for supporting President Bola Tinubu over the success recorded in addressing the country’s security challenges, we consider it necessary to address the misunderstandings and misgivings around the tax reform already embarked upon by the administration.

“President Tinubu and the Federal Executive Council recently endorsed new policy initiatives aimed at streamlining Nigeria’s tax administration processes, enhancing efficiency and eliminating redundancies across the nation’s tax operations.

“These reforms emerged after an extensive review of existing tax laws. The National Assembly is considering four executive bills designed to transform and modernise Nigeria’s tax landscape.

“First is the Nigeria Tax Bill, which aims to eliminate unintended multiple taxation and make Nigeria’s economy more competitive by simplifying tax obligations for businesses and individuals nationwide.

“Second, the Nigeria Tax Administration Bill (NTAB) proposes new rules governing the administration of all taxes in the country. Its objective is to harmonise tax administrative processes across federal, state and local jurisdictions for ease of compliance for taxpayers in all parts of the country.

“Third, the Nigeria Revenue Service (Establishment) Bill seeks to rename the Federal Inland Revenue Service (FIRS) as the Nigeria Revenue Service (NRS) to better reflect the mandate of the Service as the revenue agency for the entire federation, not just the Federal Government.

“Fourth, the Joint Revenue Board Establishment Bill proposes the creation of a Joint Revenue Board to replace the Joint Tax Board, covering federal and all states’ tax authorities.

“The fourth bill also suggests establishing the Office of Tax Ombudsman under the Joint Revenue Board, which would serve as a complaint resolution body for taxpayers.

“It is instructive to note that these proposed laws will not increase the number of taxes currently in operation. Instead, they are designed to optimise and simplify existing tax frameworks.

“The tax rates or percentages will remain the same under these reforms, as they focus on ensuring a more equitable distribution of tax obligations without adding to the burden on Nigerians.

“The reforms will not lead to job losses. On the contrary, they are structured to stimulate new avenues for job creation by supporting a dynamic, growth-oriented economy.

“Importantly, these laws will not absorb or eliminate the duties of any existing department, agency, or ministry. Instead, they aim to harmonise revenue collection and administration across the federation to ensure efficiency and cooperation.

“At the moment, tax administration lacks coordination among federal, state, and local tax authorities, often resulting in overlapping responsibilities, confusion, and inefficiency. Without reform, this inefficiency will persist.

“The proposed laws aim to coordinate efforts between different tiers of government, resulting in better tax resource management and greater clarity for taxpayers.

“Under existing laws, taxes like Company Income Tax (CIT), Personal Income Tax (PIT), Capital Gains Tax (CGT), Petroleum Profits Tax (PPT), Tertiary Education Tax (TET), Value-Added Tax (VAT), and other taxing provisions in numerous laws are administered separately, with individual legislative frameworks.

“The proposed reforms seek to consolidate these multiple taxes, integrating CIT, PIT, CGT, VAT, PPT, and excise duties into a unified structure to reduce administrative fragmentation.

“On the proposed derivation-based VAT distribution model, which the Northern Governors oppose, it must be stressed that the new proposal, as enunciated in the Bill, is designed to create a fairer system.

“The current model for distributing VAT is based on where the tax is remitted rather than where goods and services are supplied or consumed. The ongoing tax reform seeks to correct the inherent inequity in the current derivation model as a basis for distributing VAT revenue.

“The new proposal before the National Assembly outlines a different form of derivation which considers the place of supply or consumption for relevant goods and services. This means that states in the Northern region that produce the food we eat should not lose out just because their products are VAT-exempt or consumed in other states.

“These reforms are critical to improving the lives of Nigerians and were not put forward by President Tinubu to undermine any part of the country. There is no better time than now for the National Assembly to give due consideration to these bills that will overhaul our tax systems and create the revenue all the tiers of government require to fund the development our country and people urgently need.”

Continue Reading

Trending