Three tiers of governments in Nigeria have kept aside 41.5 percent out of the ₦1.9 trillion total revenue generated in the month of June with the intention to use the saved money to cushion the effect of the fuel subsidy removal on Nigerians in the country.
The Presidency in a statement on Thursday, said the 36 states including the local governments areas decided to always save a portion of the monthly revenue generated for cushioning the effects of the fuel subsidy removal on the people in the various states and council areas.
Presidency in a statement signed by Dele Alake, the special adviser to President Bola Ahmed Tinubu on Special Duties, Strategy and Digital Communications, said, President Bola Tinubu has approved the establishment of Infrastructure Support Fund (ISF) for the 36 States of the Federation as part of measures to cushion the effects of the petrol subsidy removal on the people.
“The approval was disclosed at the monthly meeting of the Federation Account Allocation Committee (FAAC), on Thursday July 20, 2023, in Abuja.
“The new Infrastructure Fund will enable the States to intervene and invest in the critical areas of Transportation, including farm to market road improvements; Agriculture, encompassing livestock and ranching solutions; Health, with a focus on basic healthcare; Education, especially basic education; Power and Water Resources, that will improve economic competitiveness, create jobs and deliver economic prosperity for Nigerians.
“The Committee also resolved to save a portion of the monthly distributable proceeds to minimize the impact of the increased revenues-occasioned by the subsidy removal and exchange rate unification-on money supply, as well as inflation and the exchange rate.
“Out of the June 2023 distributable revenue of 1.9 trillion Naira, only N907 billion will be distributed among the three tiers of government, while 790 billion will be saved, and the rest will be used for statutory deductions.
“These savings will complement the efforts of the Infrastructure Support Fund (ISF) and other existing and planned fiscal measures, all aimed at ensuring that the subsidy removal translates into tangible improvements in the lives and living standards of Nigerians.
“The Committee commends President Tinubu for the bold decision to remove the petrol subsidy, and even more importantly, for providing necessary support to the States to cushion the effects of the subsidy removal on Nigerians”, the Presidency statement reads in quote.
The Federation Account Allocation Committee, FAAC, shared the sum of 907.054 billion Naira June 2023 Federation Account Revenue to the Federal Government, States and Local Government Councils.
The July FAAC meeting was chaired by the Accountant General of the Federation, Dr. Oluwatoyin Madein.
The total distributable revenue comprised, distributable statutory revenue of 301.501 billion Naira, distributable Value Added Tax (VAT) revenue of 273.225 billion Naira, Electronic Money Transfer Levy (EMTL) revenue of 11.436 billion Naira and Exchange Difference revenue of 320.892 billion Naira.
The balance in the Excess Crude Account (ECA) stood at 473,754.57 Dollars.
The communiqué issued after the FAAC meeting on Thursday indicated that Gross statutory revenue of 1.153 trillion Naira was received for the month of June 2023, higher than the sum of 701.787 billion Naira received in the previous month by 451.134 billion Naira.
According to the communiqué signed by Bawa Mokwa, Director, Press and Public Relations, office of the accountant general of the federation, Companies Income Tax (CIT) recorded tremendous increase in the month under review.
Import and Excise Duties, Value Added Tax (VAT), Oil and Gas Royalties increased significantly, while Petroleum Profit Tax (PPT) and Electronic Money Transfer Levy (EMTL) decreased considerably.