Disturbed by the consistent shortfall in projected government revenue, President Muhammadu Buhari said plans are underway by the Federal Government to revisit the Fiscal Responsibility Act, 2007.
Sections 32, 33 and 34 of the Fiscal Responsibility Act, 2007, deal with how government revenue is to be handled by the Ministries, Departments and Agencies of government ( MDAs)
President Buhari, had while presenting the 2018 budget to the joint session of National Assembly in Abuja on Tuesday, said revenue collection was 14 percent below target as of September 2017, mainly due to the shortfall in non-oil revenues.
Speaking on the revenue performance so far, the president regretted that most MDAs are still in the habit of shortchanging government in remittance of collectable revenue and reminded them that the whistleblower policy was strongly in place.
“I would like to inform Nigerians that the whistle blowers line is still open,” he stressed.
The 2018 budget’s fiscal assumptions and parameters, shows a federally-collectible revenue estimate of N11.983 trillion.
According to him: ” The Federal Government’s estimated total revenue is N6.607 trillion in 2018, which is about 30 percent more than the 2017 target.
“As we pursue our goal of revenue diversification, non-oil revenues will become a larger share of total revenues. In 2018, we project oil revenues of N2.442 trillion, and non-oil as well as other revenues of N4.165trillion .”
From the non-oil sector, the government is projecting a revenue of N4.165 trillion , from sources such as Share of Companies Income Tax (CIT) of N794.7 billion , share of Value Added Tax (VAT) of N207.9 billion, Customs & Excise Receipts of N324.9 billion, FGN Independently Generated Revenues (IGR) of N847.9 billion, FGN’s Share of Tax Amnesty Income of N87.8 billion, and various recoveries of N512.4 billion, N710 billion as proceeds from the restructuring of government’s equity in Joint Ventures and other sundry incomes of N678.4 billion.”
But the President said key revenue shortfall was from Independent Revenues, adding that “only N155.14 billion was remitted by September 2017 as against the projected pro-rated sum of N605.87 billion. This represents a 74 percent shortfall.”
The President described the situation as “very disappointing” adding that “This recurring issue of under-remittance of operating surpluses by State Owned Entities is absolutely unacceptable.”
He declared that he has directed the economic management team ( EMT) to ensure strict compliance with the Fiscal Responsibility Act.
“Accordingly, I have directed the Economic Management Team (EMT) to review the fiscal profiles of these agencies, to ensure strict compliance with the applicable Executive Orders and Financial Regulations. There may be a need to consider a review of the Fiscal Responsibility Act and the Executive will be approaching the National Assembly on this issue in due course”
The President also cited the case of the Joint Admissions and Matriculations Board, ( JAMB) which in September 2017, announced that they were ready to remit N7.8 billion to the government.
“The shocking discovery was that in the last decades, JAMB only remitted an aggregate of N51 million. This clearly illustrates the abuses that occur in State Owned Entities, as well as their potential for increased Independent Revenues, if only people would do the right thing. We all need to play our role to ensure the right thing is done. I would also like to remind Nigerians that the Whistle Blower lines are still open.”
Although the President did not say which section of the Act will need rigging, Section 32 of the Act which deals with Forecast and Collection of Public Revenue” states that “Any fund due to the Federation from any tier of government, may be set off by the federation on or towards payment or remittance of any sum due to that tier of government from the Federation.”
Section 33 which drawls with Revenue Forecast said “The Executive Arm of the Federal Government shall, at least 30 of measures to combat tax fraud and evasion.” days before the deadline for the submission of its budget proposals, place at the disposal of the National Assembly, the revenue estimates for the following year, including the net current revenue and the respective memorandum items,
Section 34 however show Executive must breakdown estimated revenue.
Tony Ailemen, Abuja
