36 States generate N801bn IGR against N2.6trn from FAAC

36 States generate N801bn IGR against N2.6trn from FAAC
Gov.Ambode of Lagos
Only six states in the country are viable, based on the generation of independent revenue outside statutory federal allocations, a report published by Economic Confidential asserted yesterday.

e money than they receive from Abuja. The report reveals that Lagos and Ogun states respectively generated 169% and 127% of the handouts they got from Abuja putting them on solid ground in terms of economic survival

The four other states that were noted by the report to be economically strong even though not generating enough to match the handouts from Abuja were Rivers, Delta, Edo and Kwara states.

Lagos with IGR of N302 billion in fiscal 2016 remarkably generated more revenue in 2016 than 30 other states of the country who together generated a combined revenue of N258 billion. The other six states that were outside the bracket were Ogun, Delta, Rivers, Kwara and Edo.

The IGR are generated by states through Pay-As-You-Earn Tax (PAYE), Direct Assessment, levies, Road Taxes and revenues from Ministries, Departments and Agencies (MDAs).

The Economic Confidential in its report, yesterday, said: “The IGR of the 36 states of the federation totalled N801.95 billion in 2016 as compared to N682.67 billion in 2015, an increase of N119.28 billion. While the report provides shocking discoveries to the effect that 14 states which have less than 10% IGR may not stay afloat outside the Federation Account Allocation due to socio-political crises including insurgency, militancy and herdsmen attacks, others lack foresight in revenue generation drive coupled with arm-chair governance.”

The magazine pointing out the states that are at the risk of survival without handouts from the Federation Account stated: “The states that may not survive without the Federation Account due to poor internal revenue generation include Borno, which realized a meagre N2.6bn compared to a total of N73.8bn it received from the Federation Account Allocation (FAA)  in 2016 representing about 4%. Others are: Ebonyi with IGR of N2.3bn compared to FAA of N46.6bn representing 5%; Kebbi N3.1bn compared to FAA of N60.88bn representing 5.14%; Jigawa with N3.5bn compared to N68.52bn of FAA representing 5.15% and Yobe with IGR of N3.24nn compared to N53.93bn of FAA representing 6.0% within the period under review.

“Other poor internal revenue earners are Gombe, which generated N2.94bn compared to FAA of N46bn representing 6.26%; Ekiti N2.99bn compared to FAA of N47.56bn representing 6.28%;  Katsina N5.54bn compared to FAA of N83bn representing 6.65% and Sokoto N4.54bn compared to FAA of N65.97bn representing 6.88%.”

Noting the revenue generating capacities of the different states, the report puts Lagos as the number one revenue generating state in the country with N302 billion in IGR in fiscal 2016 compared to N178 billion handout from Abuja. The state is followed by Ogun with N72.98 billion IGR compared with N57 billion received from the federation account in the same year.

“Others with impressive IGR include Rivers with N85bn compared to FAA of N134bn representing 63%; Edo with IGR of N23bn compared to FAA of N59bn representing 38%. Kwara State, however, with low receipt from the Federation Account has greatly improved in its IGR of N17bn compared to FAA of N49bn representing 35%, while Delta with IGR of N44bn compared to FAA of N126bn representing 34.92%,” the report deposed.

Continuing, the report asserted that “the Economic Confidential ASVI further showed that only three states in the entire Northern region have IGR above 20%. They are Kwara, Kano, and Kaduna states. Meanwhile, eight states in the South recorded over 20% IGR in 2016. They are Lagos, Ogun, Rivers, Edo, Delta, Cross River, Enugu, and Oyo states.”

“The states with the poorest Internally Generated Revenue of less than 10% in the South are Imo, Bayelsa, Ekiti, and Ebonyi states, while in the North we have Niger, Nasarawa, Sokoto, Katsina, Gombe, Yobe, Jigawa, Kebbi and Borno states.

Meanwhile, it emerged, yesterday, that the Federation Account Allocation Committee (FAAC) disbursed the sum of N496.39 billion to the three tiers of government in April 2017 from the revenue generated in March 2017, N29.46 billion more than the N466.93 billion disbursed in the month of March. The disbursement is, however, N17.76 billion less than the N514.15 billion shared among the three tiers of government in January.

A report released by the National Bureau of Statistics (NBS) noted that the amount disbursed comprised of N322.19 billion from the Statutory Account; N66.97 billion from exchange gain; N22.59 billion from Excess Petroleum Product Tax (PPT) Account; N78.65 billion from Valued Added Tax (VAT) while the sum of N6.33 billion was refunded to the Federal Government from the Nigerian National Petroleum Corporation (NNPC).

“Federal Government received a total of N195.57 billion from the N496.39 billion shared. States received a total of N127.99 billion and Local governments received N95.99 billion. The sum of N35.75 billion was shared among the oil producing states as 13 per cent derivation fund and N22.26 billion transferred to the Excess Petroleum Product Tax (PPT) Account. Revenue generating agencies such as Nigeria Customs Service (NCS), Federal Inland Revenue Service (FIRS) and Department of Petroleum Resources (DPR) received N3.84 billion, N5.13 billion and N3.61 billion respectively as cost of revenue collections.

“Further breakdown of revenue allocation distribution to the Federal Government of Nigeria (FGN) revealed that the sum of N164.64 billion was disbursed to the FGN consolidated revenue account; N3.49 billion shared as derivation and ecology; N1.75 billion as stabilization fund; N5.88 billion for the development of natural resources; and N4.21 billion to the Federal Capital Territory (FCT) Abuja,” the report stated.

Recall that FAAC disbursed N466.93bn to the three tiers of government in March 2017 from the revenue generated in February 2017, comprising of N290.16 billion from the Statutory Account; N40.33 billion from exchange gain; N60.89 billion from Excess Petroleum Product Tax (PPT) Account; N69.21 billion from Valued Added Tax (VAT) while N6.33 billion was refunded to the Federal Government from the Nigerian National Petroleum Corporation (NNPC).  Federal government received a total of N180.51 billion from the N426.88 billion shared, States received N116.51 billion and Local governments received N87.47 billion, while N3.80 billion was shared among the oil producing states as 13 percent derivation fund and N31.47 billion transferred to the Excess Petroleum Product Tax (PPT) Account.

 

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