*FAAC Doles Out N954bn to the Three Tiers
*Highest Monthly Allocation Under Buhari
*Excess Crude Account balance now $470,599.54m
August 25, 2022.
Obviously following recent upward swing in the monthly allocations to the three tiers of government, the Federation Account Allocation Committee, FAAC, announced on Wednesday that it shared a total sum of N954.085 billion among the federal, state and local governments as July’s statutory Federation Allocation
The amount, representing an increase of N151.678bn over June’s N802.407bn, is the highest distributable monthly revenue release by FAAC since the inception of the Muhammadu Buhari administration.
A statement by FAAC’s Director (Information, Press and Public Relations), Office of the Accountant General of the Federation, Henshaw Ogubike, indicates that the July figure comprises N776.918bn distributable statutory revenue and N177.167bn distributable Value Added Tax, VAT, revenue. It added that the federal government, states and council areas received N26.575bn, N88.584bn and N62.008bn respectively from VAT’s N177.167bn distributable revenue.
According to the statement, the total deductions for cost of collection stood at N47.254bn whereas deductions for transfers, savings and refunds stood at N255.762bn.
Although no official explanation was given for the steady rise in distributable monthly allocations, a breakdown indicates that while the central government, states and council areas received N406.610bn; N281.342bn and N210.617bn respectively.
In addition, relevant states shared the sum of N55.515bn as 13% derivation revenue.
Experts attribute the steady rise in the federation allocation to significant increase in a number of tax regimes, including Companies Income Tax, CIT, Petroleum Profit Tax, PPT, Excise Duties and Oil and Gas Royalties.
They also hold the view that the rise may not be unconnected to the balance in the Excess Crude Account, ECA, which dropped to $35.37mn in the previous month but rose to $376,655 in June and a further increased to $470,599.54 in July. However, the month recorded a drop in gross revenue available from VAT, standing at N190.256bn and shedding N17.892bn, compared to June’s N208.148bn figure.