Money

VAT revenue shrinks by N3.33 billion in July

Published

2 years ago

August 21, 2021

VAT revenue shrinks by N3.33 billion in July

The amount the Nigerian government generated from Valued Added Tax (VAT) in July was reduced by N3.33 billion.

A communiqué issued at the end of the virtual meeting of the Federation Account Allocation Committee (FAAC) for August 2021 stated that the gross revenue available from the Value Added Tax (VAT) was N151.134 billion compared to N154.465 billion available in the month of June.

It added that the sum of N4.534 billion allocation to NEDC and N6.045 billion cost of revenue collection were deducted from the N151.134 billion gross Value Added Tax (VAT) revenue, resulting in the distributable Value Added Tax (VAT) revenue of N140.555 billion.

From the N140.555 billion distributable Value Added Tax (VAT) revenue, the Federal Government received N21.083 billion, the state governments received N70.278 billion and the local government councils received N49.194 billion.

In total, the Federation Accounts Allocation Committee (FAAC) shared N760.717 billion for July 2021 to the federal, states and local governments.

The communique stated that N760.717 billion total distributable revenue comprised distributable statutory revenue of N617.705 billion; distributable Value Added Tax (VAT) revenue of N140.555 billion and Exchange Gain of N2.457 billion.

In July 2021, the sum of N63.501 billion was the total deductions for cost of collection, statutory transfers and refunds while the balance in the Excess Crude Account (ECA) remained $60.855 million.

The communiqué confirmed that from the total distributable revenue of N760.717 billion; the Federal Government received N321.226 billion, the State Governments received N222.514 billion, and the Local Government Councils received N166.562 billion.

The sum of N50.415 billion was shared to the relevant states as 13 per cent derivation revenue.

From the distributable statutory revenue of N617.705 billion available for the month, the Federal Government received N299.004 billion, the state governments received N151.659 billion and the local government councils received N116.922 billion.

The sum of N50.120 billion was given to the relevant states as 13 per cent derivation revenue.

The Federal Government received N1.139 billion from the total Exchange Gain revenue of N2.457 billion. The state governments receive N0.578 billion, the Local Government Councils received N0.445 billion and N0.295 billion was given to the relevant States as 13 percent derivation revenue.

According to the Communiqué, in the month of July 2021, Petroleum Profit Tax (PPT), Companies Income Tax (CIT), Oil and Gas Royalties recorded significant decreases while Value Added Tax (VAT) Import and Excise Duty decreased marginally.

The communiqué was however silent on if the states will obey the Port Harcourt Federal High Court judgment and start collecting VAT in their states and the reaction of the states to the recently signed Petroleum Industry Act (PIA).