FG, States, LGs Richer As FAAC Reflates Economy With N907bn

The three federating units are richer with N205.3 billion following the disbursement of N907.054 billion from the June 2023 revenue of the Federation Account Allocation Committee (FAAC) to reflate the economy.

FAAC distributed N907.054 allocation for June 2023 on Thursday, representing an increase of N205.3 billion over the N701.8 billion May 2023 allocation that was distributed in June 2023. The increase in revenue was caused by the tremendous increase in Companies’ Income Tax (CIT), Import and Excise Duties, Value Added Tax (VAT), and Oil and Gas Royalties. Petroleum Profit Tax (PPT) and Electronic Money Transfer Levy (EMTL) however, declined.

Total accruals into FAAC for the month of June was N1.9 trillion and the revenue item that hugely boosts accruals into FAAC is the Exchange Difference which contributed N320.9 billion.

FAAC generated N1.9 trillion in June out of which N907.054 billion was distributed and the balance of N979.1 billion will be saved. Out of the balance, N790 billion will be used to fund the newly established Infrastructure Support Fund (ISF) for the 36 States to cushion the effects of the petrol subsidy removal on the people.

The new Fund that has just been approved by President Bola Tinubu will draw funds from savings from FAAC revenue to enable the states to intervene and invest in the critical areas of Transportation, including farm-to-market road improvements; Agriculture, encompassing livestock and ranching solutions; Health, with a focus on basic healthcare; Education, especially basic education; Power and Water Resources, that will improve economic competitiveness, create jobs and deliver economic prosperity for Nigerians.

“Out of the June 2023 distributable revenue of 1.9 trillion Naira, only N907 billion will be distributed among the three tiers of government, while N790 billion will be saved, and the rest will be used for statutory deductions”.

“These savings will complement the efforts of the Infrastructure Support Fund (ISF) and other existing and planned fiscal measures, all aimed at ensuring that the subsidy removal translates into tangible improvements in the lives and living standards of Nigerians”, according to Dele Alake, President Tiubu’s spokesperson.

Meanwhile, the Accountant General of the Federation, Oluwatoyin Madein said the Federation Account Allocation Committee (FAAC) reflated the economy with a total of N907.054 billion June 2023 Federation Account revenue.  to the Federal Government, States, and Local Government Councils. The amount distributed was N205.3 more than the May allocation of N701.8 billion

The N907.054 billion comprised distributable statutory revenue of N301.501 billion, distributable Value Added Tax (VAT) revenue of N273.225 billion, Electronic Money Transfer Levy (EMTL) revenue of N11.436 billion, and Exchange Difference revenue of N320.892 billion.

In June 2023, the total deductions for the cost of collection were N73.235 billion and the total deductions for savings, transfers, and refunds were N979.078 billion. The balance in the Excess Crude Account (ECA) was $473,754.57

A breakdown of the N907.054 billion allocation showed the Federal Government received N345.564 billion, the State Governments received N295.948 billion and the Local Government Councils got N218.064 billion. A total sum of N47.478 billion rep[resenting 13 per cent derivation revenue went to the littoral states as additional allocation.

Madein disclosed that gross statutory revenue of N1,152.921 billion was received for the month of June 2023, higher than the sum of N701.787 billion received in the previous month by N451.134 billion.

From the N301.501 billion distributable statutory revenue, the Federal Government received N146.710 billion, the State Governments received N74.413 billion and the Local Government Councils received N57.370 billion. The sum of N23.008 billion was shared with the relevant States as 13 percent derivation revenue.

For the month of June 2023, the gross revenue available from Value Added Tax (VAT) was N293.411 billion, higher than the N270.197 billion available in the month of May 2023 by N23.214 billion. From the VAT Account, the Federal Government received N40.984 billion, the State Governments received N136.613 billion and the Local Government Councils received N95.629 billion from the N273.225 billion distributable Value Added Tax (VAT) revenue.

The N11.436 billion Electronic Money Transfer Levy (EMTL) was shared as follows: the Federal Government received N1.715 billion, the State Governments received N5.718 billion and the Local Government Councils received N4.003 billion.

The federal government got N156.155 billion from the N320.892 billion Exchange Difference revenue, the State Governments received N79.204 billion, the Local Government Councils received N61.063 billion and the sum of N24.470 billion was shared with the relevant States as 13 percent mineral revenue.