….says proposed N12.43 trillion budget deficit unacceptable
By Haruna Salami
The Senate on Tuesday kicked against proposed N6 trillion tax and import duties waivers proposed for the N19.76 trillion 2023 budget with attendant deficit of N12.4 trillion.
It consequently directed the Nigeria Customs Service (NCS), to carry out downward review of the proposed waivers by 50% and also tasked the Federal Inland Revenue Service (FIRS), to critically look into seeming abuse of tax credit by some companies.
He Senate equally tasked Nigeria Customs Service (NCS) to review the waiver by 50% just as it tackled Federal Inland Revenue Service (FIRS) on Tax credit.
These were sequel to the interface between the Senate Committee on Finance and the Minister of Finance, Budget and National Planning, Mrs Zainab Ahmed as well as heads of revenue generating agencies in the country on proposed 2023 – 2025 Medium Term Expenditure Framework (MTEF) and Fiscal Strategy Paper (FSP).
The Finance Minister had at the interactive session informed the committee that the proposed N19.76 trillion 2023 budget will have deficit of N12.43 trillion as a result of projected N6trillion tax and import duty waivers and fuel subsidy of over N6 trillion as well, if retained for the whole year.
Worried by the submission, the Committee Chairman, Senator Solomon Olamilekan ( APC Lagos West ) , told the Minister that both the projected N12.43 trillion budget deficit and N6 trillion tax and import duty waivers should be critically reviewed downward before sending the proposals to the National Assembly for consideration and approval.
He specifically told the Minister to look into the list of beneficiaries of the waivers for required downward review to N3 trillion with attendant reduction of N12.43 trillion deficit figure .
“The proposed N12.43trillion deficit for the 2023 budget and N6trillion waivers are very disturbing and must be critically reviewed.
“Many of the beneficiaries of the waivers are not ploughing accrued gains made into expected projects as far as infrastructural developments are concerned.
“The same goes for tax credit window offered by FIRS to some companies.
“Billions and trillions of Naira can be generated by government as revenue if such windows are closed against beneficiaries abusing them and invariably provide required money for budget funding with less deficit cum borrowings.
“The Nigeria Customs Service should help in this direction by critically reviewing waivers being granted on import duties for some importers just as the FIRS should also review the tax credit window offered some companies without corresponding corporate social services to Nigerians in terms of expected project executions like road construction.
“Generally, the issue of waivers should be taken strongly by relevant authorities because Nigeria does not have the capacity for now. We cannot accommodate this N6trillion tax waivers”, he said.
But the FIRS Chairman , Muhammad Nami, told the committee that tax credit is an important innovation of government which has yielded positive results from September 2019 when it was introduced through Executive order 007 by President Muhamnadu Buhari .
He urged the committee not to move in the direction of scrapping it as it is only given to companies with evidence of projects execution.
He informed the committee that out of the N6.08trillion projected revenue from January to July 2022, FIRS generated N5.59 trillion and assured that the N10.4 trillion projected for the year, will be achieved.
The Comptroller – General of Nigeria Custom Service ( NCS) , Col Hammed Ali (Rtd), also assured the committee of improved revenue generation in 2023 fiscal year.
The interface continues Wednesday with expected appearances of the Governor of Central Bank, Godwin Emefiele and Group Managing Director of Nigerian National Petroleum Corporation Limited (NNPCL) Mele Kyari before the Committee.
