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N7.3tn Remitted to Federation Account in Six Months – RMAFC

Chairman, RMFAC, Mohammed Bello

The Revenue Mobilization Allocation and Fiscal Commission  has revealed that a total of N7.3 trillion was deposited into the Federation Account between July and December 2023, indicating an increased revenue flow.

The Federation Account Allocation Committee shared the amount, which was remitted to the Central Bank of Nigeria under the title “CBN Federation Account Component Statement.”

RMAFC Chairman Mohammed Bello Shehu noted in a press statement in Abuja that this figure is higher than the N5.24 trillion earned in the first half of 2023.

Out of the total gross revenue inflow, N1.69 trillion was moved to the Exchange Gain Differential Account, leaving a balance of N5.475 trillion for distribution.

From the remaining balance, N3.26 trillion was deducted as approved statutory deductions by the OAGF, resulting in a net balance of N2.2 trillion for distribution across the three tiers of government.

Additionally, out of the N3.267 trillion statutory deductions, N2.251 trillion was transferred to the Non-Oil Excess Account as savings, leaving a net statutory deduction of N1.016 trillion for sharing across the three tiers of government.

During the period under review, a net sum of N4 trillion was distributed among the three tiers of government.

In terms of percentages, Shehu highlighted that statutory deductions in the second half of the year made up 44.12% of total gross inflows into the Federation Account, which was higher than the 42.31% in the first half of the year.

On remittances by revenue-generating agencies, Shehu disclosed that the Nigerian National Petroleum Company Limited contributed N874.64 billion in the second half of the year, compared to zero in the first half.

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The Nigerian Upstream Petroleum Regulatory Commission remitted N1.56 trillion, while the Federal Inland Revenue Service contributed N3.65 trillion.

The government’s earnings increased due to the removal of fuel subsidies and the unification of the foreign exchange market by the current administration.

These policies have increased government revenue but have also impacted citizens with harsh economic realities.

In a related matter, the RMAFC chairman proposed that the cost of collection for revenue-generating agencies should be linked to their performance, incentivizing them to increase revenue generation and remittances.

He explained that this approach would encourage the agencies to develop new strategies to enhance revenue generation and remittances, thereby raising the cost of collection.

“We strongly advocate that the cost of collection for RGAs should be tied to their revenue performance,” he concluded. “In other words, each RGA should receive a cost of collection commensurate with the revenue generated against its revenue target, as specified in the Appropriation Act.”