FG Unveils New Revenue Plan, Tasks MDAs On Improved Targets
BY COBHAM NSA, ABUJA – The Federal Government is determined to effectively address concerns over fluctuating oil revenue with its new Strategic Revenue Growth Initiatives (SRGIs) for sustainable revenue generation into the national coffers.
Minister of Finance, Mrs Zainab Shamsuna Ahmed said the fresh initiatives are targeted at improving government revenues in both non-oil and oil sectors of the economy.
According to the Minister, outlined in the initiatives are defined and set revenue targets for all Ministries, Departments and Agencies (MDAs) designated as revenue generating agencies of government.
She also hinted that government is already looking at increasing Value Added Tax (VAT) on selected items, especially luxury products, adding that such moves will be initiated in collaboration with the National Assembly that would have to amend the existing law.
Presenting the SRGIs’ packages to the respective agencies in Abuja on Wednesday, Mrs Ahmed said it has become imperative to create fresh revenue outlays as well as revenue sustainability for government given the current volatility in global oil prices.
She stated that government was properly guided by its the Economic Recovery and Growth Plan (ERGP) in producing the document, adding that the focus is on enhancing oil and non-oil revenues; effective management of global and domestic fiscal risks; collaborating with other economic MDAs to closely coordinate Nigeria’s fiscal, macroeconomic, monetary and trade policies; as well as optimising capital and recurrent expenditures for effective service delivery to Nigerians
The Minister admitted that revenue improvement has become a serious challenge, particularly in relation to mobilizing fiscal resources to deliver on socio-economic development targets as enunciated in the ERGP.
She explained that the idea stems from the current fiscal terrain and recent revenue outturn performance with the realization of budgeted revenue at about 50 per cent as at the third quarter of 2018.
Mrs Ahmed said with the presidential mandate that the Finance Ministry generate extra revenues for national development by proactively monitoring all revenue generating MDAs’ collections, the country still has quite a huge task at hand before achieving the ERGP’s target of about 15 per cent tax to GDP ratio.
According to her, “This mandate is very critical and important and I intend to make it my priority. It also is the very reason we are all gathered here at this launch event. Challenge of revenue generation has been on over the years despite our being referred to as largest economy in the continent”.
On government’s intention to deploy VAT for improved tax generation tool, the Minister noted that the current VAT revenue to GDP in Nigeria pitiably stands at less than one percent (0.8 percent) and hugely falls short of ECOWAS average that is 3.4 percent.
She also lamented the nation’s poor inflow from excise revenue which currently stands 4.1 percent, as against 15 per cent achieved by our West African neighbours, Ghana and the 19.5 per cent being enjoy by Kenya
“The first thematic area is on achieving sustainability revenue generation to optimally collect revenues, so we can always maintain fiscal buoyancy and resilience”, the Minister said, adding that the next is to identify “new revenue streams and enhancing the enforcement with regards to revenue collection on our existing revenue streams.”
Mrs Ahmed further explained that government is out to achieve cohesion among revenue generating entities while equipping them with the necessary cutting-edge tools and expertise to engender high performance and turnaround in meeting set revenue targets.
Presentations by MDAs at the event came from the Federal Inland Revenue Service (FIRS), Nigeria Customs Service (NCS), and the Office of the Accountant General of the Federation (OAGF) among others
