Despite the drop in oil revenues amid the ravaging impact of the dreaded coronavirus pandemic, the Federation Accounts Allocation Committee (FAAC) on Wednesday shared about N780.9 billion to the three tiers of government for March 2020.

This was confirmed in a statement from the office of the Accountant-General of the Federation at the end of the virtual FAAC meeting of the representatives of the federal, states and local governments, along with Federal Capital Territory counterparts.

Others who participated in the online meeting included representatives of all the revenue-generating agencies, namely the Federal Inland Revenue Service (FIRS), Nigeria Customs Service (NCS), Department of Petroleum Resources (DPR) and the Nigerian National Petroleum Corporation (NNPC).

Details

Details of the revenue distribution were contained in a Statement of Accounts by the FAAC in Abuja.

A total of N780.926 billion shared during the meeting consisted statutory revenue, Value Added Tax (VAT), and foreign exchange gain, with the balance of the Excess Crude Revenue Account (ECA) currently at about $72.2 million.

The gross statutory revenue for the month of March 2020, the Committee said, was N597.7 billion, which is higher than the N466.1 billion received in February by N131.6 billion.

The gross revenue realised from the Value Added Tax (VAT) was about N120.3 billion against N99.6 billion in February 2020, an increase of about N20.7 billion.

A total of N62.9 billion was realized from Exchange Gain for the month.

A breakdown of the allocations showed that the federal government received the largest share of about N264.3 billion, the state governments N181.5 billion, and the local government councils N135.9 billion.

The oil-producing states were given N38.8 billion as 13 per cent derivation revenue for the month, while the cost of revenue collection by revenue agencies and allocation to NEDC was N160.4 billion.

In addition, the federal government received N217.8 billion out of the gross statutory revenue of N597.7 billion against about N110.5 billion received by the state governments and N85.2 billion by the local government councils.

About N32.3 billion was given to the relevant states as 13 per cent derivation revenue and N152 billion as cost of revenue collection by revenue agencies and allocation to NEDC.

The federal government got N16.7 billion from the Value Added Tax (VAT), with the state governments receiving N55.9 billion, the local councils N39.1 billion, while the cost of collection by revenue agencies and allocation to NEDC was N8.4 billion.

A further share of about N29.8 billion was paid to the federal government, the state governments N15.1 billion, the councils N11.6 billion and the oil-producing states N6.4 billion from the N63 billion available from Exchange Gain.

For the month, the Committee said the Petroleum Profit Tax (PPT), Companies Income Tax(CIT), Import and Excise Duties, Oil and Gas Royalties and Value Added Tax (VAT) all recorded substantial increases.

Impact of coronavirus

Following the breakout of the coronavirus pandemic, crude oil exports, which has been the major source of financing for the FAAC has dwindled, amid declining oil prices at the international oil market.

The meeting of the committee for February ended in a stalemate following the rejection of the revenue presented by the revenue agencies for sharing.

The FAAC members considered the revenue presented for that month as grossly below the threshold for the revenue agreed by members in December 2018.

To salvage the situation, the National Economic Council approved that the Nigeria Sovereign Investment Authority (NSIA) should make available about $150 million from the Stabilisation Fund to support FAAC to meet its obligations from June this year.

With the balance in the excess crude oil revenue account dropping to $72.2 million, the future looks challenging for the government as the pandemic bites harder on the world economy.

Credit: premium time