The Federation Account Allocation Committee (FAAC) disbursed NGN 1.12 trillion to the three tiers of government in April, based on March revenue figures, marking a 2.6% month-on-month decline from NGN 1.15 trillion in March. This amount represents 60.1% of the total revenue of NGN 1.87 trillion generated in March, after deductions for the cost of collection (NGN 69.54 billion) and interventions and refunds (NGN 674.88 billion).
Notably, significant declines were observed across various revenue streams including excise duties, oil royalties, petroleum profit tax (PPT), electronic money transfer levy (EMTL), and custom external tariffs (CET) levies. Conversely, receipts from import duty, value-added tax (VAT), gas royalties, and companies’ income tax (CIT) experienced increases.
Analysts anticipate that the currency depreciation resulting from the liberalization of the foreign exchange market will continue to support oil revenue in naira terms. However, challenges such as relatively lower crude oil production may hamper efforts to reach pre-pandemic levels of oil revenue. Despite this, there is optimism regarding the sustained improvement in economic activities and the impact of the provisions of the 2023 Finance Act, which are expected to bolster non-oil revenue and support overall revenue generation. This news underscores the ongoing challenges faced by the Nigerian government in managing its revenue sources amidst a dynamic economic landscape. While certain revenue streams exhibit resilience, others face volatility, highlighting the need for strategic planning and policy interventions to ensure fiscal stability and economic growth.
