Nigeria: Excess Crude Account Receives First Transfer Since Nigeria's Recession

Photo: Vanguard

The Federation Accounts Allocation Committee (FAAC) said on Wednesday that members resolved to transfer about N24.5 billion from the revenue for the month in the excess crude account (ECA) -- the first since the country's economy went into recession two years ago.

Federal, State and Local Governments on Wednesday shared over N701 billion as statutory allocation for the month of May as the said it recorded increased earnings from all revenue streams during the month.

The Permanent Secretary, Federal Ministry of Finance, Mahmoud Isa-Dutse, said the decision to begin saving in the excess crude account again followed improved accruals from all revenue streams in recent time.

Mr. Isa-Dutse, who was addressing reporters at the end of the April meeting of the Committee, said the bulk of the revenue increases came from the non-oil sector, which rose by over N81.25 billion.

"Things have begun to improve. That is why we are beginning to save again," he said. With latest injection of funds into the ECA, he said the balance has been boosted to about $1.911 billion.

Presenting the outcome of the meeting, Mr Isa-Dutse said gross statutory revenue of N613.06 billion realized during the month was higher by N132.5 billion than the N480.6 billion collected in the previous month.

"Crude oil export sales volume increased by 64 per cent, compared with the 7.72 million barrels from the previous month. This resulted in increased revenue from Federation Crude Oil Exports Sales by $226.9 million. The average crude oil price for the month grew from about $65.72 to about $66.78 per barrel," he said.

He said the performance for the month would have been better, but for few production shut-ins and shut-downs recorded at various oil terminals currently undergoing repairs of leaks as well as routine maintenance.

The Permanent Secretary said there was equally significant increases in revenue realized from Company Income Tax (CIT), Petroleum Profit Tax (PPT) and Oil Royalty, with import duties and value added tax (VAT) registering marginal increases.

Collections from the Federal Inland Revenue Service (FIRS) was about N5.72 billion; Nigeria Customs Service (NCS) N4.1 billion; Department of Petroleum Resources (DPR) N4.1 billion, while VAT was N88 billion.

Further details of the revenue for the month showed that a total of N411.3 billion came from minerals sector, and N201.3 billion , while excess bank charges, verification and reconciliation on accruals in the Federation Account brought additional N419 million.

Chairman, Finance Commissioners Forum and Adamawa State Commissioner for Finance, Mahmoud Yunusa, said the States were happy about the improvement in the revenue figure.

"The States feel good with the increased revenue situation, because we have crossed the N700 billion mark. But still far from the trillion Naira revenue collection mark, which we want to be as quickly as possible.

"As States, we are working closely with all the revenue generating agencies to ensure we increase the revenue from taxes to boost further earnings from non-oil sector.

On revenue sharing formula, Mr Yunusa said discussions have commenced to see how the States can have a realistic review of revenue sharing formula.

We believe as States most people residing in the States and Local Governments are the people that deserve to have more revenues to have the desired impact of government. An announcement would be made at the appropriate time.

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