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Despite Widespread Poverty, FG Set To Introduce New Taxes On Nigerians

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The Federal Government will soon introduce new taxes and excise duties to raise funds for the execution of projects. Minister of Finance Mrs Zainab Ahmed made this known on Thursday, December 20, 2018, at the budget breakdown in Abuja, The Nation reports.

The Federal Government will soon come up with new revenue generating initiatives to shore up resources available for the execution of projects.

Under the  proposed regime, new taxes and excise duties will be imposed to mobilise domestic revenue for better budget funding.

Speaking at the 2019 budget breakdown in Abuja on Thursday, December 20, 2018,, Minister of Finance Mrs. Zainab Ahmed said her ministry’s focus now “is on revenue because we do have to mobilize more domestic revenue so that we can better fund our budget. You can see from the performance that there is gap between what is projected for in the budget and what is actually generated”.

As a result, Mrs. Ahmed disclosed that government “very soon will be generating new revenue initiatives which will include a new set of taxes and excise duties but also working with the Federal Inland Revenue Service, FIRS, and Customs for new and enhanced measures for enforcement and also for compliance. By doing what we are doing, we might have to go to National Assembly to amend some laws that we have identified that as some gaps, some loop holes. We are doing everything we can to make sure our budgets are better funded going forward and it will start from 2019.”

With regards to the performance of the 2018 budget, Mrs. Ahmed disclosed that N820 billion has been released to Ministries, Departments and Agencies, MDA, for capital expenditure. This represents 43 per cent of MDA capitals for the fiscal year. The government, she said, is working to push this to N1.1 trillion by the end of this month.

In respect of fuel subsidies, the finance minister revealed that the ministry “is currently in the process of issuing promissory note to fuel marketers and last week released the first batch of N177 billion to the fuel marketers and we are doing some reconciliation processes to release the second batch to the fuel marketers, perhaps before the year closes out or in any case as early as possible in the New Year”.

On excess crude account controversy, Mrs Ahmed said “the excess crude account was refunded yesterday we had sent another N50 billion savings into the excess crude account. If you recall that the NEC had authorized the use of $1 billion from the excess crude account for security, so the performance of that instruction is what has produced what we have in the Excess Crude Account. So it has been largely depleted but we are still saving to it and this is the third month that we have been saving consistently into the Excess Crude Account.”

On the status of stamp duty cash, FIRS Chairman Babatunde Fowler noted that “what has happened is that in our stamp duty act, there is no provision for electronic transfer, especially in the banking sector. So, there is discrepancy in terms of collection of stamp duties whether it is NIPOST or FIRS. So, until the law is amended and currently it is in the House, the money is being warehoused in the Central Bank of Nigeria, CBN. But in terms of the actual amount, the Central Bank of Nigeria has those figures.”

On MDAs owing taxes, Fowler said: “We still have a lot of MDAs that are owing taxes before 2015 and with the help of the Presidency and the Ministry of Finance, they have come forward with an instalmental payment plan. The question was asked why the money was deducted from the current budget allocations,  it is because they have to continue to run and perform their services and they are limited as to how much can be deducted at once and that being said, a number of them have requested to pay over 46 years.  That shows the revenue that was not remitted prior to 2015.”

The highlight of the budget breakdown was the presentation made by the Minister of Budget and National Planning Udoma Udo Udoma. The 2019 Budget proposal, he said, seeks to continue the reflationary and consolidation policies of the 2017 and 2018 Budgets, which helped put the economy back on the path of growth.

Allocations to Ministries, Departments and Agencies, MDAs, of Government, he said, were guided by restoring and sustaining growth; investing in our people and building a globally competitive economy.”

As with 2016, 2017 and 2018 Budgets, the 2019 Budget, he pointed out, “has been prepared on the Zero Based Budget, ZBB, Principles. The 2019-2021 Medium Term Fiscal Framework, MTFF, Medium Term Sector Strategies and proposed 2019 Budget reflect many of the reforms and initiatives in the ERGP, which is our roadmap to economic recovery and a more sustainable growth. Projects are linked to government policies and overarching strategic priorities.”

As part of government’s revenue making plans for 2019, Udoma disclosed that “the Federal Government has sustained its efforts to improve public financial management through the comprehensive implementation of the: Treasury Single Account, TSA, the Government Integrated Financial Management Information System, GIFMIS, and the Integrated Payroll and Personnel Information System, IPPIS.”

He also reiterated that President Muhammadu Buhari “has directed that immediate action be commenced to restructure the Joint Venture Oil Assets so as to reduce government shareholding to 40 percent and that this exercise must be completed within the 2019 fiscal year and that the Department of Petroleum Resource, DPR, shall, within three months, complete the collection of past-due oil licence and royalty charges.”

Following President Buhari’s directive, the Ministry of Finance, working with all the relevant authorities, he said, has been authorised to take action to liquidate all recovered and unencumbered assets within six months.

Given the improved oil prices and production levels, Nigerian National Petroleum Corporation, NNPC, he added, has been ordered “to immediately commence the recovery of all outstanding obligations, including those due from Nigerian Petroleum Development Company, NPDC, (a subsidiary of NNPC), which it had agreed to pay since 2017.”

Read more at The Nation

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