By Geoff Iyatse
The shortfall in oil revenues has been balanced out by a leap in revenue from non-oil sources. According to the 2022 budget performance presented by the Minister of Finance, Budget and National Planning, non-oil revenue totaled N2.09 trillion in the 11 months. The figure was 23.3 per cent above the targets contained in the budget.
Retained revenue from company income tax (CIT) stood at N1.08 trillion while that of the value-added tax (VAT) was N295.2 billion, the minister disclosed. Both revenue sources did moderately above the budget benchmark – by 58.6 per cent and 24.3 per cent respectively.
The scorecard also disclosed that customs collections (comprising import duties, excise, fees and special levies) exceeded the target by N15.42 billion.
It added that the government earned an “independent revenue” of N1.32 trillion while “other revenues” were N3.72 trillion.
The Guardian had reported that the Federal Government’s total retained revenue for the period was N6.4 trillion or 87 per cent of the prorata target of N7.48 trillion.
Revenue performances have fallen short of targets in recent years, forcing the government into incessant borrowings to bridge the gaping hole in appropriation. Some of the deficits, which have exceeded projections, have been blocked by loans from external and domestic sources with overdrafts by the Central Bank of Nigeria (CBN) serving as major support.
From less than N1 trillion in 2015, a backlog of supports from the apex bank has skyrocketed to N22.7 trillion. This year, the ways and means (W&M) facility will cost the government N1.8 trillion in interest payments.
President Muhammadu Buahri has written the National Assembly seeking the securitization of the facility with an arrangement reached for a nine per cent bond offering. With the arrangement, though seen as alien to W&M management style and a contradiction of the CBN Act, the government will spend less servicing the loan and take it off the CBN balance sheet.
The National Assembly has turned down the executive request, seeking more explanation on the accumulated liability. At the 2023 Appropriation Law signing in Abuja earlier in the week, the President urged the lawmakers to urgently consider approving the securitisation plan to enable the government complete the process of converting the debt into a long-term instrument.
In the just-signed 2023 Appropriation Act, the Federal Government intends to borrow another N8.8 trillion to augment its ambitious N10.49 trillion revenue target. The amount is about N3.4 trillion higher than the annualised last year’s retained earnings (N7.1 trillion).