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Increase in non-oil revenue boosts FAAC allocations
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- The Minister of Finance attributed the rise in FAAC revenue to efficiency in non-oil tax collection by the federal government’s revenue generating agencies.
The monthly revenue shared by the Federation Accounts Allocation Committee (FAAC) amongst the three tiers of government rose by 86 percent month-on-month in June.
FAAC revenue shared in June rose to N559.032 billion, up from N305.13 billion shared in May and N281.5 billion shared in April, according to figures provided by Kemi Adeosun, the Minister of Finance, shortly after a FAAC meeting on Thursday.
The minister attributed the rise in FAAC revenue for June to efficiency in non-oil tax collection by the federal government’s revenue generating agencies, particularly the Federal Inland Revenue Service (FIRS) and the Nigeria Customs Service (NCS).
Adeosun said the FIRS’ contribution to the Federation Account rose by N165 billion month-on-month in June, while the NCS’ contribution rose by N12.6 billion month-on-month. The government also recorded an exchange rate gain of N79.2 billion during the month under review.
“The big cause of the increase is the improvement of non-oil revenue from the FIRS,” Adeosun said. “This is a significant improved performance, especially by the Customs that was able to do so despite the scarcity of foreign exchange and the restrictions on the 41 items.”
A breakdown of the FAAC allocation shows that the federal government received N199.754 billion, state governments received N101.318 billion, and local governments received N78.112 billion. Oil producing states received N17.124 billion as 13 percent mineral derivation revenue.
The disbursement of revenue from Value Added Tax (VAT) shows that the federal government received N9.706 billion, states received N32.353 billion, and local governments received N22.647 billion.
“We are quite encouraged . . . because it means that some of the reforms that we have started around collection improvement are beginning to bear fruit,” the minister said.
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