Revenue Generation – Dr. Kenny Odugbemi

The federal government under the current administration has pledged to meet its financial and economic goals as stated in FY 2024, and considering our present depressed economy in state of quagmire and comatose, it has become more crucial for the need to adopt multidimensional approach to improve on our revenue generation as we can only spend what we can earn
For example, FRIS has a target of N11trn but they are targeting an additional N1trn this December 2023

Revenue collection will leverage
VAT,
CIT,
Custom revenue (increase in consumption, GDP, import)
Hence lowering inflation of 27.5% to 21.4% amidst of expansionary fiscal policies which is now getting out of order and this can distort projected revenue
Federal government intend to project 18% more than last year’s economy.

Collection of all inclusive taxes and fees is the most acceptable way in Nigeria to generate a projection of N18.5trn for Fy2024,by tracking revenue against the target to that there is revenue drive performance

Federal government standpoint

Achieving the proposed revenue projection will require a very radical reform as a complete paradigm shift from our more than two decades norms of low internally generated revenue in Nigeria

This critical approach will include and is not limited to the following

Enactment of an economic emergency bill that will be further reviewed by NASS and passed as law through robust legislation

The need to double our revenue from government owned enterprises -NNPC, NLNG etc

Proper management of Capital release
Promote through legislation to NASS direct payment to all Contractor s through MDA’s , Accountant general and Ministry of finance as this will attract 12.5%

Statutory 12.5% as Tax based on services rendered by Contractors as against when MDA’S pay Contractors

Reduce quantum of remittance in excess of N60trn as balance across account of all the MDA’S

Creating value for money as against MDA’s paying contractors directly which does not attract any form of tax

Facilitating digital transformation of a single window in our revenue collection drive

Custom will be fully restructured and recalibrated to harmonize revenue collection

Risk

Oil production capacity
Crude oil prices
Harmonize exclusive non-oil taxes

Reduce tax waiver schemes, where they are now treated as capital expenditure

Restructure, Recalibrate Reposition of all MDA’s in accordance with Orosanye report

Governments at the three tier level need recalibration through lean management to reduce recurrent expenditure, meeting monthly target of N1trn
FRIS will now be able to collect 12.5% of our capital expenditure of N8.75trn

Manufacturer’s standpoint

Recapitalize Local FDI-BoI

Create SPV for effective capital finance

Database of 2500 is well segmented

Improve on N75b @9% annually with emphasis on food and beverage’s

Nigeria is now member African Continent trade after fulfilling the following

State party through ratified agreement and schedule of tariff

Submission of signatory

Establish action committees

Classification of our commitment

Nominations of Designated Authority

Willingness to contribute

Non tariff measure+ gazette of our tariff classification

N75B @9% annually must be taken as a test case to demonstrate readiness to improve manufacturing sector

We now have the mantra
Of tax the fruits not the seed

Improvement in all round revenue collection

Legislation of reduction of number of taxes from 60 to 10

Facilitating the harmony of fiscal and monetary policies

Empowering local investors for certainty

Resolving these local issues that are causing most multinational organization leaving Nigeria

Repatriation of their funds

Cost of production

Multiple tax and tariff structures

Rise in the cost of diesel

Scarcity of forex

Truncation of Raw materials

High import duties

Ease of forex sourcing

Small scale & Nanoscale enterprises

Direct credit facilities to aid a quick turnaround to guarantee employment for the unemployed 43% youths in Nigeria

Maintain mega-markets across commercial urban centres across 36 states, including Abuja as Federal capital

Ensure direct credit in single digits through cooperative in each market due to failure of government institutions such NISRAL and SMEADAN

Conclusion

The government must develop neglected rural areas with about 70% of our population where all forms of infrastructure are non existent

Promote backwards integration to develop our rural economy to produce home grown products to banning of all imported materials

Facilitate good investment to promote diverse agricultural practices to boost our food production capacity