The amount of money shared by the various tiers of government in Nigeria declined by N69 billion in February, according to a report by the Federation Account Allocation Committee (FAAC).
The figures showed that the amount distributed in February stood at N716 billion as against N647.35 billion in January , which was 9.63 percent lower than the N716. 29 billion shared in December 2019.
The committee’s statement in the local media last week revealed that receipts from import duty were significantly higher on the month, whereas those from petroleum profit tax, companies’ income tax, VAT, and oil and gas royalties decreased. The balance in the excess crude account declined from US$325 million to US$72 million over the month.
The gross payout consisted of the statutory allocation of N525 billion, the VAT Pool of N105 billion, a modest exchange-rate gain of N1 billion and miscellaneous non-mineral revenue of N16 billion. The fees and charges of the three tax collection agencies absorbed N24 billion of the total declared.
The payout falls short of the recurrent spending needs of most states, let alone their capital requirements.
The communique noted a fall in inflows from the Federal Inland Revenue Service. Collection by the service is generally at its lowest in the first quarter.
The distribution will benefit from the rise in the standard rate of VAT from 5.0% to 7.5% with effect from this month. States receive 50% of the payout, local governments 35% and the FGN 15%.
