- N3.8tr Budget Deficit Slows Current, Capital Expenditure
The Fiscal Policy Roundtable Co-Chair Doyin Salami has linked government’s inability to meet recurrent and capital expenditures to N3.8 billion budget defict and debt profile of N22.7 trillion.
Salami, who was represented by Taiwo Oyedele – PwC West Africa Tax Leader, and Research Director at Nigeria Economic Summit Group (NESG) Fiscal Policy Roundtable said the launching of the Citizen Perception Report, a first of several research pieces to be published in support of its tax reform and advocacy vehicle “Better Tax”is good for the economy.
He explained that Better Tax seeks to close knowledge gaps in fiscal policy and create a sustainable framework to actualise the Federal Government’s inclusive economic agenda.
Launched in Lagos, the citizens perceptions report, which is the product of a nationwide perception survey cutting across households and small businesses in the tax value chain, tasked government to establish an Office of Tax Simplification (OTS) among other recommendations targeted at demystifying complex provisions in the nation’s tax laws and boosting dwindling revenues from the non-oil sector of the economy.
Chairman, NESG Fiscal Policy Roundtable, Sarah Alade said, the core concept of the Roundtable was to reflect the needs and objectives that forms the basis of a robust fiscal reform platform focused on mobilising and growing the country’s tax revenue.
The IMF estimates that revenue collected in 2016 across all tiers of Government was only about six per cent of GDP. Historically, more than 70 per cent of those revenues have come from the oil sector while the non-oil sectors, which account for more than 90 per cent of GDP, have historically contributed about 30 per cent to revenues.
“This limits Nigeria’s ability to credibly execute its development plan and fund critical social sector programmes. It also leaves Nigeria very vulnerable to macro-economic shocks from low oil prices. The most recent fall in oil prices threw Nigeria into a fiscal crisis with spill-over effects on the economy resulting in a recession in 2016. Building a strong revenue base that is balanced between the oil and non-oil sector is therefore critical to sustainably financing Nigeria’s development programme and long-term macro-economic stability.”
According to Alade, data from the Citizen Perception Survey reinforces the appalling level of fiscal responsibility in taxpayer education, which fuels apathy and low morale among taxpayers. She said: “beyond the general clamour for increasing revenues and the correlation with higher tax rates, there are other issues around taxpaying in Nigeria. There is the presumption that the Nigerian citizenry is apathetic to the payment of taxes, which makes the findings of the Citizen Perception Survey crucial. The findings show that Nigerians are not averse to taxpaying given proper education and expenditure transparency on the allocation and application of resources by the Government.
Oyedele, who shared evidence-based data from the Citizen Report during his technical presentation at the event, disclosed that “low tax compliance results from tax complexity, crisis of trust in the government and inadequate social contract deliverables; while tax officials were constrained by inconsistent tax policies, limited resources, unrealistic targets, and inability to influence service delivery, among others”. Citing the date from the Citizens Perceptions Reports, he said that over 70 per cent of Nigerians believe that “it is not wrong to pay taxes”. This sentiment, is fuelled by the issues around the social contract between the government and the citizenry
During the panel discussion on “Making Taxation Work for Nigeria – Issues, Solutions and Priorities”, Prof. Teju Somorin emphasized the need for balanced fiscal responsibility between the government and the citizens. President, Manufacturers Association Of Nigeria Engr. Ahmed Mansur also emphasised the fact that tax revenues are part of the bigger issue of the missing link in the social contact between the people and the government.
In the next few months, the NESG Fiscal Policy Roundtable will continue to leverage Better Tax to disseminate the findings from its analysis of the fiscal space, both from the revenue and expenditure viewpoint
Ecobank To Pay Customers N5 For Every Dollar Received
Ecobank To Pay Customers N5 For Every Dollar Received
Ecobank has implemented the CBN scheme which offers N5 for every Dollar received into domiciliary accounts or as cash over the counter. Korede Demola-Adeniyi; Head, of Consumer Banking, Ecobank Nigeria, who announced this in Lagos stated that the decision is in line with the CBN directive and fully aligns with efforts to encourage the inflow of diaspora remittances into the country.
She noted that the “CBN Naira 4 dollar scheme” is an unprecedented incentive for senders and recipients of international money transfers.
Korede Demola-Adeniyi said that the scheme takes effect from 8th March and will run till 8th May 2021. “Ecobank will pay N5 on every Dollar so beneficiaries will not only get the foreign currency sent from their family and friends abroad, but they will also get extra Naira”, she stated.
Only recently, Ecobank had a first-of-its-kind virtual Diaspora Summit to discuss opportunities for Nigerians living abroad and the various platforms available to assist them with their investment decisions and remittance needs. The event had major players in the remittance space, diaspora audience, government officials and notable stakeholders in attendance.
Further, the Managing Director, Ecobank Nigeria, Patrick Akinwuntan has disclosed that apart from consistent engagement with Nigerians in the diaspora, Ecobank is leveraging its digital technology to make remittances to Nigeria and Africa easy, convenient and affordable.
Mr. Akinwuntan stated that growing evidence has shown a positive relationship between diaspora remittances and economic growth.
“Ecobank will continue to pursue its mandate of helping to enhance the economic development and integration of Africa, through the 33 countries where the bank operates on the continent. Ecobank’s Rapidtransfer and mobile app (Ecobank Mobile) enable Africans, wherever they are, to easily and instantly send money to bank accounts, mobile wallets and agent locations across 33 African countries”, he stated.
Ecobank Nigeria, a member of the Pan African Banking Group is committed to supporting Africans in the diaspora by providing advisory services, remittance solutions, investment options and financial planning schemes. The bank also offers mortgages, treasury bills, capital market instruments, among others.
Peter Obaseki Retires as Chief Operating Officer of FCMB Group Plc
The Board of Directors of FCMB Group Plc has announced the retirement of Mr. Peter Obaseki, the Chief Operating Officer of the financial institution, with effect from March 1, 2021. He was also an Executive Director of the Group.
His retirement was approved at a meeting of the Board of the Group on February 26, 2021. This has also been announced in a statement to the Nigerian Stock Exchange (NSE) by the financial institution.
The Chairman of FCMB Group Plc’s Board of Directors, Mr Oladipupo Jadesimi, thanked Mr. Obaseki for his valuable service and excellent support to the Board for many years.
FCMB Group Plc is a holding company divided along three business Groups; Commercial and Retail Banking (First City Monument Bank Limited, Credit Direct Limited, FCMB (UK) Limited and FCMB Microfinance Bank Limited); Investment Banking (FCMB Capital Markets Limited and CSL Stockbrokers Limited); as well as Asset & Wealth Management (FCMB Pensions Limited, FCMB Asset Management Limited and FCMB Trustees Limited).
The Group and its subsidiaries are leaders in their respective segments with strong fundamentals.
For more information about FCMB Group Plc, please visit www.fcmbgroup.com.
COVID-19: CBN Extends Loan Repayment by Another One Year
Central Bank Extends One-Year Moratorium by 12 Months
The Central Bank of Nigeria (CBN) has extended the repayment of its discounted interest rate on intervention facility by another one-year following the expiration of the first 12 months moratorium approved on March 1, 2020.
The apex bank stated in a circular titled ‘Re: Regulatory forbearance for the restructuring of credit facilities of other financial institutions impacted by COVID-19’ and released on Wednesday to all financial institutions.
In the circular signed by Kelvin Amugo, the Director, Financial Policy and Regulation Department, CBN, the apex bank said the role-over of the moratorium on the facilities would be considered on a case by case basis.
The circular read, “The Central Bank of Nigeria reduced the interest rates on the CBN intervention facilities from nine per cent to five per cent per annum for one year effective March 1, 2020, as part of measures to mitigate the negative impact of COVID-19 pandemic on the Nigerian economy.
“Credit facilities, availed through participating banks and OFIs, were also granted a one-year moratorium on all principal payments with effect from March 1, 2020.
“Following the expiration of the above timelines, the CBN hereby approves as follows:
“The extension by another 12 months to February 28, 2022 of the discounted interest rate for the CBN intervention facilities.
“The role-over of the moratorium on the above facilities shall be considered on a case by case basis.”
It would be recalled that the apex bank reduced the interest rate on its intervention facility from nine percent to five percent and approved a 12-month moratorium in March 2020 to ease the negative impact of COVID-19 on businesses.
To further deepen economic recovery and stimulate growth, the apex bank has extended the one year-moratorium until February 28, 2022.
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