2021 Budget: Agbakoba Writes Buhari, Recommends New Revenue Sources
***says nigeria can generate n20trn, 10m jobs in 5 years
A Senior Advocate of Nigeria (SAN), Dr. Olisa Agbakoba, has urged President Muhammadu Buhari to adopt a Strategic Revenue Growth Initiative (SRGI) to address the deficit of the 2021 budget.
Agbakoba made the suggestion in a letter written to the President titled “The Need for New Revenue Sources”.
The Federal Government has proposed a budget of N13.08 trillion for 2021, with a projected deficit of N4.48 trillion and capital expenditure of N2.083 trillion.
The proposed Budget, which will be presented this week by President Buhari to a joint sitting of the National Assembly, is predicated on an exchange rate of N379/$, oil benchmark of $40 barrel per day, and oil production volume of 1.86 million per day, including 400,000 condensate.
In the letter to the president, the former president of the Nigerian Bar Association (NBA) identified five critical elements of the SRGI, namely: revenue generation, job creation, economic growth, ease of process, and reducing cost of governance and leakages.
He explained that the SRGI has become necessary as the country is faced with an unprecedented revenue challenge exacerbated by the COVID-19 pandemic and the crash in oil prices.
Agbakoba said, “There are many opportunities to realise enormous revenue and jobs from the services sector otherwise known as soft economy.
“One of the great interests that can generate revenue is the Apapa Port city. A recent report by a Dutch consultancy firm, Dynanmar, shows that Nigeria loses N20 billion daily at the ports, which is N7.2 trillion yearly.
“The second area that can also generate substantial income is trade facilitation.
“Trade is Nigeria’s second largest contributor to Gross Domestic Product but it is shocking that Nigeria lacks the critical and essential tools of trade facilitation which are vessels and airlines.
“So legislation is proposed to introduce the Nigerian National Shipping Line and Air Nigeria, If our local content policy and laws are implemented in terms of trade facilitation, Nigeria can generate over N20 trillion and 10 million jobs in five years.”
The SAN also raised concerns over land administration in the country.
According to him, a recent study shows that the housing inventory of Nigerian property exceeds $7 trillion.
He, however, said that most of the housing inventory is dead capital that cannot be used as collateral for financial transactions because they are not properly titled.
He advised that creating an efficient title system by introducing a Land Use Administration Act, will release a lot of revenues into the system.
Agbakoba said, “Looking at all these areas and without any serious study, it shows that we are almost at N100 trillion. But with concerted deep study, it is possible to hit the N100 trillion mark.
“Government should explore new sources of revenue to close the budget deficit and grow the economy by enacting the Strategic Revenue Growth and Recovery Act.”
He observed that the SRGI is targeted at the Department of Petroleum Resources, the Nigerian National Petroleum Corporation, Office of the Accountant General of the Federation, Federal Inland Revenue Service, Nigeria Customs Service and Nigerian Ports Authority.
Agbakoba commended President Buhari for the early submission of the 2021 Budget to the National Assembly, noting that it shows government’s concern towards reflating the economy.
He canvassed an expansionary fiscal policy but acknowledged that both fiscal and monetary policies were broadly harmonised.
Comments are closed.