WorldStage Newsonline– As the Federal Government of Nigeria proposed a budget of N13.08 trillion for 2021, the Minister of Finance, Budget and National Planning, Mrs. Zainb Ahmed has assured that several measures are being instituted to improve government revenue and entrench a regime of prudence with emphasis on achieving value for money.
The budget proposal which was presented to the National Assembly by President Muhammadu Buhari is N1.15trillion higher than the 2020 provision of N2.69trillionwith an aggregate of N3.85trillion budgeted for capital projects.
Speaking during a public presentation and breakdown of the highlight of the 2021 appropriation bill, on Tuesday in Abuja, Mrs. Ahmed, said the aggregate revenue available to fund the 2021 budget is projected at N7.89trillion (35% more than the 2020 revised budget of N5.84trillion), adding that 60 government Enterprises have been integrated in the 2021 budget proposal.
According to her, government planned to source for funding of N13.08trillion 2021 budget, she noted that, an aggregate of 31% of projected revenues is come from oil related sources while 69% is to be earned from non-oil sources to, adding that the budget size is constrained by relatively low revenue.
On the expenditure framework, the federal government aggregate expenditure inclusive of GOEs and project tied loan, is projected to be N13.08trillion, which is 21% higher than revised 2020 budget. The recurrent (none-debt) spending, estimated to amount to N5.93 trillion, is 43.4% of total expenditure, and 14.32% higher than 2020 revised estimate inclusive of increase in salaries and pension.
She said a total of N3.12 trillion has been projected for debt service is 23.88% of total expenditure, 16.63% higher than 2020 revised budget, in addition is provision to retire maturing bonds to local contractors/ suppliers of N220b is 1.68% of total expenditure. This reflects FGN’s commitment to offset accumulated arrears of contractual obligations during back over 10years.
On budget deficit, she said the overall budget deficit is N5.196trillion for 2021, representing 3.64% of the GDP, she added that the budget deficit will be financed mainly from borrowings through, Domestic sources N2.14trillion, foreign sources N2.14trillion, multi-lateral/bi-lateral loan drawdowns N709.69billion and privatisation proceeds of N205.15billion.
She said, “The goal of fiscal interventions will be to keep the economy active through carefully calibrated regulatory/policy measures designed to boost domestic value-addition, de-risk the enterprise environment, attract external investment and sources of funding, etc.
“Improving the tax administration frame work to optimize government revenue is a major thrust of the Administration’s Strategic Revenue Growth Initiative (SRGI).
“We have included a Tax Expenditure Statement (TES) as part of documents accompanying the 2021 Budget to the National Assembly which seeks to dimension the cost of tax waivers/concessions, and evaluate their policy effectiveness. Tax expenditures (TEs) are currently estimated to (1) CIT N1.18tr, (2) VAT N3.1tr, (3) Customs Duties N347bn (4) VAT on Imports 64bn. Going forward, we will set annual ceilings on TEs to better manage their impact on already constrained government revenues.”
