Mr. Wale Edun, the Minister of Finance and Coordinating Minister of Economy, reports that since the subsidy was removed, the Federation Account has seen an increase in revenue inflow, rising from an average of N650 billion per month to over N1 trillion over the last four months.
At a four-day retreat held in Asaba, the capital of Delta State, on Monday for members of the Federation Account Allocation Committee, Edun made this statement.
Mr. Okokon Udo, the Permanent Secretary of the ministry, read the minister’s remarks and thanked FAAC for choosing the retreat’s theme, “Creating a Resilient Economy through Diversification of the Nation’s Revenue.”
“I applaud your choice of theme because of the appropriateness and the utmost attention that the Bola Tinubu administration has directed toward domestic revenue mobilization,” he said. “
The economic reforms that this administration has undertaken since its inception in May 2023 clearly outlined right steps to transformation of the country’s economy.
” “In less than six months of the administration, we have witnessed the introduction of important reforms, such as the removal of petroleum subsidies, fiscal and monetary policy reforms aimed at removing multiple taxation among others.
“The Federation Account in particular is witnessing improved revenue inflow since the removal of subsidy, which has increased from an average of N650 billion monthly to over N1 trillion in the last four months.
The government has long realized that fuel subsidies are unsustainable because they divert funds from other necessary expenditures that are vital to the general welfare of the public.
He claimed that two of Tinubu’s administration’s main goals are to reach the 22 percent tax revenue to GDP target and the 18 percent tax to GDP target by 2026.
Governor of Delta State Sheriff Oborevweri declared the retreat open and asked FAAC to deal with the delayed distribution reimbursements to the states.
The governor stated that many stakeholders have expressed concerns regarding the Nigeria National Petroleum Company Limited’s new responsibilities and how they may impact the flow of revenue into the Federation Account since the Petroleum Industry Act’s implementation, as represented by its deputy, Mr. Monday Onyema.
“It is my hope that this retreat will address these concerns and put them to rest permanently,” the governor stated.
This is particularly true for the federation’s oil-producing states, where a number of incorrect calculations are being fixed and reimbursements are being given.
Nevertheless, I observe that much work has to be done in this regard, especially with regard to the payment of 13% derivation to states that produce oil since the Petroleum Industry Act’s implementation.
The Federation Account is under the custody of the CBN. Prior to being distributed to the federating units, all money received by the revenue-generating units is stored at the CBN.
There have occasionally been reports of payment delays to states following FAAC plenary resolutions. After this retreat, I anticipate more thorough and understandable accounting statements and reports.