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New Revenue Formula: FG recommends new figures

LGs to earn more.                           

Pledges quick implementation                                       

By Emma Okereh.                                       

 The federal government has promised to implement the outcome of the ongoing review of the current Vertical Revenue Allocation Formula being carried out by the Revenue Mobilization Allocation and Fiscal Commission (RMAFC).

This is even as it has proposed new figures for allocation between the three tiers of government. While giving the federal government position on the review, Secretary to the Government of the Federation (SGF), Boss Mustapha, who was represented by the Permanent Secretary in charge of political and economic  affairs, Andrew David Adejoh,at the public Hearing for the Federal Capital Territory (FCT) on Tuesday, assured of the FG’s commitment to it once it is ratified by the national assembly.                               

 ” On behalf of President Muhammadu Buhari, I wish to re-assure all Nigerians that the federal government will implement the final outcome of the conclusion of this exercise as soon as the National Assembly enacts the relevant legislation to complete the processing’.”. 

It also recommends that the federal government should have 50.65%,, state government 25.62%, local government 23..73 while Derivation still stands at 13%. The new proposed formula is a shift from the current suspension that runs thus:  FG 52.68%, State government 26.72%, LG20.60% while Derivation is 13%. It advised that states should up their Internally Generation Fund counseling that’s’ It is important to restart that revenue application should be done constructively in the face of dwindling national revenue base and the imperative for states to generate their IGR. Equally important is the fact this review should culminate in improved national development.”.

The SGF admitted that the present revenue allocation formula, both vertical and horizontal is long overdue for a  review not only because the last one was done in 1992, but ”most importantly, contemporary issues since then, such as heightened insecurity, decaying infrastructure, need for appropriately matching statutory functions and tax powers, need to be taken into consideration. He commented RMAFC for the consultative process it adopted in ensuring that the diverse views across all spectrum of the society taken into consideration.

He cautioned that review of revenue cannot and should not be an emotional or sentimental discussion and should not be done arbitrarily. It submitted that to have an endearing vertical review  of the presentation revenue allocation formula,, the responsibilities to be carried out by all must be agreed. Earlier, the chairman of RMAFC, Engr Elias Mbam informed that the commission  relied on its statutory powers of the 1999 constitution as amended to embarrass on the review.

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