FG MAY INCREASE VAT BY 2.5% IN 2021

Federal Government on Tuesday disclosed that it has spent N7.09 trillion as at the end of the third quarter of 2020 fiscal year, just as it unveiled plans to introduce additional 2.5% Value Added Tax (VAT) rate in 2021 fiscal year as part of efforts aimed at increasing revenue generation.

Minister of Finance, Budget and National Planning, Dr Zainab Ahmed disclosed this while presenting the overview of the 2020 fiscal outcomes and budget implementation/2021 budget defence to the House Committee on Finance, chaired by Hon. James Faleke.

According to documents presented to the Committee, as at the end of Q3 2020, Federal Government’s revenue available for budget funding (excluding GOEs) was N2.83 trillion, 70% of target. Federal Government share of oil revenues was N1.203 trillion (representing 158% performance, over and above the prorated sum in the revised 2020 budget) while non-oil tax revenues totalled N927.47 billion (76% of revised target).

Companies Income Tax (CIT) and Value Added Tax (VAT) collections were N486.68 billion and N137.03 billion, representing 79% and 64% respectively of the prorate revised targets for the period. Customs collections were N303.76 billion (78% of revised target). Other revenues amounted to N697.75 billion, of which independent revenues was N390.50 billion.

On the expenditure side, N9.97 trillion was appropriated (excluding GOEs and project tied loans), while N7.09 trillion (representing 94.7% of the prorate N7.48 trillion) was spent. Of the expenditure, N2.54 trillion was for debt service and N2.43 trillion for personnel cost, including pensions. As at end of September 2020, N873.9 billion had been released for capital expenditure.

Leave a Comment

Your email address will not be published. Required fields are marked *