FG To Raise Tax Revenue To 15%

David Abakpa         Posted:    10 months ago
Spread the love
FG To Raise Tax Revenue To 15%

The Nigerian federal government has concluded plans to increase its revenue target, including raising tax revenue from the current six per cent of gross domestic product to about 15 per cent.

The Minister of Budget and National Planning, Udoma Udo Udoma, disclosed this yesterday while highlighting the strategies the federal government plans to adopt in funding the 2018 budget.

President Muhammadu Buhari had last week presented a N8.6 trillion budget proposal to a joint session of the National Assembly for approval for the 2018 fiscal year.

At the presentation of the budget details yesterday, Udoma said the government’s inadequate revenue is the greatest challenge it is facing in its effort to deliver service to the people.

The minister said federal government is determined to increase its revenue target, including raising tax revenue from the current six per cent of gross domestic product to about 15 per cent, to fund the budget in the New year.

He said, “Government’s focus is to maximize the use of revenues from the oil sector and spend in the non-oil sector, to get the non-oil sector driving the economy. Once government revenue is up, the debt service ratio to the GDP would come down. More money would become available for infrastructure to better the life of the people.

“Oil is a wasting asset. This is the time to maximize our revenues from oil and spend them in the non-oil sector. That is basically the strategy of the ERGP (Economic Recovery & Growth Plan) and government’s plan in the 2018 budget”.

Other strategies to boost revenue, he said, include deployment of new technology to improve revenue collections; encourage tighter performance on management of fiscal framework for state-owned enterprises and stronger enforcement action against tax defaulters.

Apart from the tax amnesty programme by the Federal Inland Revenue Service (FIRS) to encourage voluntary payment of tax by Nigerians, the minister said government has adopted other key reform policies to realize its revenue target.

They include new funding mechanisms for joint venture operations in the oil and gas industry to allow for cost recovery in lieu of cash call payments, which constrained new investment in the oil sector.

Udoma also hinted that the federal government has proposed to spend N336.31 billion on the construction and rehabilitation of major roads across the nation in the 2018 budget.

Some of the major roads include the Lagos-Shagamu-Ibandan dual carriageway, Abuja-Abaji road, Kano-Maiduguri road, Enugu-Port-Harcourt dual carriageway, Illorin-Jebba-Mokwa-Bokani road, Calabar-Ugep-katsina Ala road among others.

Some power projects include Mambila hydro, counterpart funding for earmarked transmission lines and substations, rural electrification access program in federal universities, construction of 215MW LPFO/gas power station kaduna, fast power programme accelerated gas and solar power generation among others.

The federal government also allocated N10 billion to be expended on the second Niger Bridge.

Other breakdowns are the Ministry of transport, which got N162.28 billion counterpart funding for rail projects like the Lagos –Kano, Calabar-Lagos, Ajaokuta-Itakpe-Aladja in Warri, Port-Harcout-Maiduguri etc.

Also, N2.03 billion has been proposed for the construction of terminal building at Enugu airport, N8.32 billion for construction of second run-way of Nnamdi Azikwe international airport, Abuja.

Leave a Reply

Your email address will not be published.