Nigeria’s non-oil receipts plunged by 32 percent in the first three months of the year, pushing up fiscal deficit for the period significantly to N638.4 billion from government quarterly estimate of N221.8 billion in the 2014 budget.
The decline in non-oil revenue relative to the fourth quarter of 2013 was due to the fall in receipts from customs and excise duties, value added tax (VAT) and education tax, the Central Bank of Nigeria (CBN) said in its first quarter economic report.
Non-oil receipts between January and March totaled N605.62 billion, and showed a significant fall from the 2014 budget estimate as well as receipts in the fourth quarQ1ter of 2013 by 32.8 percent and 9.1 percent, respectively.
Oil revenue which stood at N1.8 trillion, and constituted about 74.9 percent of the total government receipts for the quarter, was equally 6.5 percent below the proportionate budget estimate – though it exceeded the receipt in the fourth quarter of 2013 by 17.6 percent on account of increased receipts from crude oil/gas exports and other oil revenue during the review period.
The CBN further noted that the Federal Government retained revenue was N823.9 billion, while total expenditure was N1.4 trillion.
“Thus, the fiscal operations of the Federal Government resulted in an estimated deficit of N638.4 billion in the first quarter of 2014, compared with the quarterly budgeted and the preceding quarter’s deficit of N221.8 billion and N628.0 billion, respectively.”
Ngozi Okonjo-Iweala, the coordinating minister for the economy and minister of finance, had signaled earlier in the year of possible drop in non-oil receipts on account of recent government fiscal policies, and increasingly because of smuggling.
She had assured that the government was reviewing these fiscal policies and had also tasked the Nigeria Customs and Immigration Services to step up vigilance at the nation’s porous borders.
She also noted that the Federal Inland Revenue Service (FIRS) was working with leading international management consultants to further boost tax revenue performance.
CBN data showed that total federally-collected revenue during the first quarter of 2014 stood at N2.4 trillion, representing an increase of 9.5 percent above the level in the preceding quarter, but was a decline of 1.7 percent from the level in the corresponding period of 2013. The development when compared with the preceding quarter was attributed, largely, to the rise in oil revenue.
Also in April alone, gross oil and non-oil receipts fell lower than the provisional monthly budget estimate, according to the report.
The unhealthy trend, experts say, now casts doubt on government ability to adequately fund the already delayed 2014 budget- more so when still faced with the challenge of finding extra N53 billion to fund the additional expenditure inputted by the National Assembly to the figure originally proposed by the executive.
