Written by Sarah NEGEDU

Nigeria records N43bn shortfall in September allocation

A total of N648.710 billion has been distributed between the Federal, States and Local Government Councils as Federal Allocation for the month of September, 2018.

The amount, shared at the FAAC meeting presided over by the Minister of Finance, Mrs Zainab Ahmed, represents a decline of N43.13bn over the N741.84bn shared in August

A breakdown of the amount showed that after deducting the cost of collection to the revenue generating agencies, the Federal Government got N300.1bn; the states, N184.43bn; while the Local Government Councils got N139bn.

The communiqué issued by the Technical sub -Committee of Federation Accounts Allocation Committee, FAAC, at the end of the meeting indicated that the Gross statutory revenue received is Crude oil export sales increased by 0.17 Million barrels resulting in increased revenue to the Federation of $8.48 Million. However the average unit price dropped from $77.10 to $75.69.

There was shut down of Pipelines which resulted in Shut in of production at various pipelines. Revenue from Royalties increased substantially while Value Added Tax, VAT, Petroleum Profit Tax , and Companies Income Tax, CIT, decreased significantly.

The distributable Statutory Revenue for the month is N569.281 billion. The total Revenue distributable for the current month (including VAT, and Exchange Gain Difference) is N648.710 billion.

The gross revenue available from the Value Added Tax was N79.154billion as against N114.542 billion distributed in the preceding month, resulting in a decrease of N35.388 billion.

Therefore, from the Revenue available from the Statutory, Value Added Tax  and Exchange Gain Difference, Federal Government received N277.197 billion representing 15%; States received N172.810 billion representing 50% while the Local Government Councils received N130.534 billion representing 35% while Derivation  (13% of Mineral Revenue) also received N52.596.

Cost of Collection /Transfer/FIRS Refund amounts to N15.572.

In the course of the meeting, additional N50 Billion was shared from the Exchange Rate Equalisation Balance. Making a total of N698.710 shared.

The communiqué read in part, “Crude oil export sales increased by 0.17 million barrels, resulting in increased revenue to the federation of $8.48m. However, the average unit price dropped from $77.10 to $75.69. There was shutdown of (crude oil) pipelines, which resulted in shut-in of production at the various pipelines.

“Revenue from royalties increased significantly, while Value Added Tax, Petroleum Profit Tax and Companies’ Income Tax decreased significantly.”

Ahmed said there was a need to ensure more savings for the country.

“We have to save. We are not only saving for today, but for tomorrow,” the finance minister stated.

The balance on Excess Crude Account as at 24th October, 2018 is $2.090 Billion while the balance in Excess Petroleum Profit Tax as at the same date is $0.133 Billion.

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