Revenues for sharing rise to N473.83bn

Nigeria’s distributable revenues to the three tiers of government rose in October to N473.83 billion, about 21.5 per cent improvement on September’s revenue, boosted by higher non-oil earnings, according to the Minister of Finance, Mrs Kemi Adeosun.

She stated that non-oil revenue recorded a significant improvement in the month, adding that intermittent “shut-down and shut-in” for repairs and maintenance at different terminals “continued to impact on crude oil and gas revenue negatively”.

The minister explained in a statement that the rainy day fund, the Excess Crude Account, remained unchanged at $2.26 billion.

Recall that the three tiers of government shared N390billion as revenue for September.

The amount comprised the month’s net statutory revenue of N321.9 billion, exchange gain of N5.2 billion as well as Value Added Tax (VAT) of N56.3 billion. About N6.3 billion was said to have been refunded to the federation by Nigerian National Petroleum Corporation (NNPC) and was also proposed for sharing.

For the preceding month, N422.6 billion was shared to the three tiers.This shows a difference of N52.6 billion.

The breakdown of the revenue shows that the Federal Government received N151.3 billion, representing 52.68 per cent; states, N76.8 billion, representing 26.72 per cent.

While the local governments received N59.1 billion, amounting to 20.60 per cent of the amount distributed. The amount shared among the oil producing states stood at N27.5 billion, representing 13 per cent derivation revenue.

On VAT, N62.1 billion collected for the month showed a decrease of N12.7 billion from what was collected in the preceding month.

The country generated N213.1 billion as mineral revenue and N108.8 billion as non-mineral revenue.This showed a decrease of N2.8 billion and N44.2 billion, respectively, from what was generated as mineral and non-mineral revenue in the preceding month.

Revenue from crude oil and gas export was negatively impacted in August  due to shut down and shut in of production for maintenance at different periods and terminals during the month. Also there was revenue loss of 32 million dollars as a result of drop in average price of crude oil from 56.7 dollars in July to 47.3 dollars in August.

The revenue challenge was further worsened with a decline of over N44 billion in non-oil revenue collections.

But the Federal Inland Revenue Service (FIRS) has targeted a revenue profile of N4.5trillion  in 2016 to raise the nation’s cash flow.

According to its acting Executive Chairman, Mr Babatunde Fowler, who stated this during his screening for confirmation at the National Assembly, the revenue from the country’s Value Added Tax (VAT) would be increased from N500million to N2.5trillion in 2016.

He also said the proposed N8 trillion budget for 2016 is realisable, saying: “The Vice President was not aware of this projection before disclosing the proposed N8trillion budget but the budget is possible.”

He added: “If oil can generate N1trillion, Customs and FIRS can generate N4.5trillion, so the budget of N8trillion is quite realisable.

“Our projection of N4.5trillion does not include an increase in VAT. This is because we are of the view that tax should be fair”.