The Minister of Budget and National Planning, Udo Udoma, has explained how the N9.1tn revenue to finance the 2018 budget will be raised by the Federal Government.
Speaking during the public presentation of the 2018 budget on Thursday in Abuja, Udoma expressed optimism that the government would be able to generate enough revenue to finance its programmes as contained in the fiscal document.
The event was attended by the Minister of Finance, Mrs Kemi Adeosun; Minister of State for Budget and National Planning, Hajiya Zainab Ahmed; the Director-General, Budget Office of the Federation, Mr Ben Akabueze, and other top government officials.
The 2018 budget, which was designed to consolidate on the Economic Recovery and Growth Plan, was presented to the National Assembly on November 7, 2017.
It was passed by the lawmakers on May 16, 2018, transmitted to President Muhammadu Buhari on May 25 and assented by him on June 20.
The fiscal document signed by Buhari had a total proposed spending of N9.1tn, made up of N2.87tn for capital expenditure, N3.51tn for recurrent (non-debt) expenditure and N2.01tn projected to be spent on debt servicing.
Giving a breakdown of how the N9.1tn budget would be financed, Udoma said the sum of N2.99tn would be generated from oil revenue, N31.25bn would come from dividend to be received from the Nigerian LNG Limited, while N1.17bn was expected to be realised from minerals and mining revenue.
The minister stated that the Federal Government was targeting to generate N658.55bn from Companies Income Tax, N207.51bn from Value Added Tax, N324.86bn from Customs duties, while N57.87bn was expected to come from Federation Account levies.
In the same vein, he said the government was expecting N847.95bn as independent revenue from its agencies, while tax amnesty income, signature bonus and unspent balance from previous years would provide N87.84bn, N114.3bn and N250bn, respectively.
He also said the sum of N374bn was expected to be realised from domestic recoveries and fines, while N138.44bn would come from other Federal Government recoveries.
The minister added that the sum of N710bn would be realised from the sale of oil assets, while grants and donor funding would contribute N199.92bn.
He stated that N146.64bn would be realised from other unnamed revenue sources, while the budget deficit of N1.95tn would be financed through borrowing of N1.64tn.
The N1.64trn borrowing is made up of domestic borrowing of N793bn and foreign debt of N849bn.
In addition, the minister said about N306bn was expected from privatisation proceeds, while N5bn was projected to be realised from the sale of other government property to partly finance the deficit.
He noted that the government would be implementing some key reform initiatives contained in the ERGP in order to boost its revenue.
Some of them are deployment of new technology to improve revenue collection, upward review of tariffs and tax rates where appropriate, and stronger enforcement action against tax defaulters.
The government, according to Udoma, will improve the revenue performance of government-owned enterprises by reviewing their operational efficiency and cost-to-income ratios.