FAAC: FG dips hands into reserves as revenue falls

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Zainab Ahmed: Minister of Finance: government dips hands into reserves to have N604b shared

The Federal Government resorted into some financial engineering to boost total revenue distributable in October, Aliyu Ahmed, the Permanent Secretary, Ministry of Finance said.

According to him, government augmented the N604 billion shared by the Federal, state governments and local councils from three sources.

He said N72 billion came from Forex Equalisation Fund, while N7.392 billion was deducted from FGN Intervention Fund.

According to him another N20 billion was sourced from the Stabilisation Account.

In effect, about N500 billion would have been available to be shared, without the augmentation to have a pool of N604.004 billion.

In a statement, Ahmed said the N604.004 billion shared included cost of collection to Nigeria Customs Service (NCS), Department for Petroleum Resources (DPR) and Federal Inland Revenue Service (FIRS).

He said the Federal Government received N220.751 billion, the States received N161.825 billion, and the Local Government Councils (LGCs) got N120.588 billion.

Ahmed added that the oil producing states received N31.902 billion as derivation (13 per cent of mineral revenue) and cost of collection/transfer and refunds got N48.939 billion.

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According to the communique issued by the Federal Account Allocation Committee, gross revenue available from the Value Added Tax (VAT) for October was N126.463 billion.

This was against N141.858 billion distributed in the preceding month of September, resulting in a decrease of N15.395 billion.

“The distribution is as follow: Federal Government got N17.642 billion, the States received N58.805 billion, Local Government Councils got N41.167 billion, while Cost of Collection/Transfer and Refund got N5.059 billion and Allocation to NEDC project received N3.794 billion.

“The distributed Statutory Revenue of N378.148 billion received for the month was higher than the N341.501 billion received for the previous month by N36.647 billion from which the Federal Government received N166.195 billon, States got N84.296 billion, LGCs got N64.989 billion, derivation (13% Mineral Revenue) got N21.581 billion and Cost of Collection/ Transfer and Refund got N40.086 billion.”

The communique also revealed that Oil and Gas Royalty, Companies Income Tax (CIT) increased substantially.

However, Import Duty, Excise Duty, VAT, and Petroleum Profit Tax (PPT) recorded decreases.

The balance in the Excess Crude Account as at Nov. 18 stands at 72.409 million dollars.