The sum of N296 billion is provided for the Sinking Fund to retire maturing bonds issued to local contractors. 23. Corporate taxes were affected by the seasonality of collections, which tend to peak in the second half of the calendar year. 5. Already, certain regional interest groups including the Pan Niger Delta Forum (PANDEF) have aired their opposition to the plan, further stoking political risks. By consensus, Nigeria's revenue of N8.15tn is inadequate to fund the N10.33tn proposed expenditure, leaving a deficit of N2.18tn. The budget expenditure is estimated at 10.33 trillion naira and the revenue generation estimated to fund the 2020 national budget is N8.155 trillion. The approved budget is N264 billion … President Buhari announced that the budget was revised due to the effect of the COVID–19 pandemic on the economy, and disclosed all MDAs will be allocated 50% of their capital allocation by months end. This material differential between Nigeria’s budget benchmark on crude oil and that of the World Bank and IEA reflects a conservative fiscal approach on revenues by the Nigerian authorities. FG will lessen the effect of a higher VAT rate by exempting businesses with a turnover of less than N25 million per annum from VAT registration. A WTO document seen by Reuters said: “For reasons including the health situation and current events, delegations will not be in a position to take a formal decision on 9 November.”, Reuters also reported that WTO insiders said the delay was because there was “no indication the Trump administration – which will continue to govern trade policy in the weeks ahead irrespective of any U.S. election result – had switched its support to Okonjo-Iweala.”. The total revenue available to fund the 2020 budget is projected at ₦8.155 trillion (7% higher than the 2019 Budget of ₦7.59 trillion). 35. Special windows were created that enabled small businesses, investors and importers in priority economic sectors to have timely access to foreign exchange. The continuous recovery reflects our economy’s resilience and gives credence to the effectiveness of our economic policies thus far. On the expenditure side, 2019 Budget implementation was also hindered by the combination of delay in its approval and the underperformance of revenue collections. 38. The Honourable Minister of Finance, Budget and National Planning will provide full details of these proposals, subsequently. His first term in office was punctuated by several medical trips to the United Kingdom. 50. Of the prorated expenditure of N4.46 trillion budgeted, N3.39 trillion had been spent by June 30, 2019. In the same vein, global demand for crude oil has tumbled – as economic activities retreated to a near halt due to lockdown measures imposed to flatten the Covid-19 curve – adversely impacting global crude oil prices. As per the OPEC+ alliance agreement, such non-compliance is to be subsequently sanctioned with a commensurate reduction in volumes. Awaiting President Buhari’s assent, the 2020 budget of N10.59 trillion was approved by the 9th National Assembly on December 5th, 2019. Specifically, oil revenues were below target by 49 percent as at June 2019. This is the summary here: the 2020 Nigeria budget is about $29 billion depending on the exchange rate of choice. Social Investment Programmes: N30 billion; p. Federal Capital Territory: N28 billion; and. We will also continue to be innovative in our borrowings by using instruments such as Sukuk, Green Bonds and Diaspora Bonds. Highlights • Non-debt recurrent expenditure includes N3.6 trillion for personnel and pension costs, an increase of N620.28 billion over 2019 for new minimum wage and proposals to improve remuneration and welfare 1. Ms Ahmed said while the federal government will fund the budget by N5.158 trillion, the deficit from N5.365 trillion will be financed by both domestic and foreign borrowing. This Finance Bill has five strategic objectives, in terms of achieving incremental, but necessary, changes to our fiscal laws. Additionally, our proposals also raise the threshold for VAT registration to N25 million in turnover per annum, such that the revenue authorities can focus their compliance efforts on larger businesses thereby bringing relief for our Micro, Small and Medium-sized businesses. A breakdown of the N10.7 trillion 2020 budget presented by President Muhammadu Buhari, on Tuesday, October 8, has shown Defence getting N100 billion. I therefore seek your support in passing into law two Petroleum Industry Executive Bills I will be forwarding to you shortly. Furthermore, to fast track the rebuilding efforts in the North East region, a provision of N37.83 billion has been made for the North East Development Commission. Firstly, by channelling assistance from international institutions into priority areas such as social security and healthcare which has helped boost the country’s economic resilience and also promoting inclusive growth. Receipts from Value Added Tax were below expectations due to lower levels of activities in certain economic sectors, in the aftermath of national elections. The VAT Act already exempts pharmaceuticals, educational items, and basic commodities, which exemptions we are expanding under the Finance Bill, 2019. The transport minister, Rotimi Amaechi, disclosed this to journalists, adding that the approval came because it “was the first time in four years that NPA is buying any vehicle.”. Capital releases under the 2019 Budget commenced in the third quarter. In the near term, areas with the potential for cost savings within the government should be identified and be tapped into. With businesses clamouring for government support, consumer demand at a record low, and a slowdown in capital inflows, the prospects for non-oil revenues are dim. In this regard, I have directed the reconstituted Ministry of Finance, Budget and National Planning to commence preparations towards the development of successor medium – and long-term economic development plans, particularly as the Nigeria Vision 20-2020 and the ERGP expire next year. 60. If you use the official exchange rate ($1 for N310), it moves to $33.3 billion. This includes drawdowns on project-tied loans and the related capital expenditure. In his chat with newsmen after defending his budget, the Permanent Secretary promised to put necessary arrangements in place to meet the medical needs of the President and other top officials once the budget is approved. 6. 13. The personal assistant to the President on New Media, Bashir Ahmad, disclosed this on Friday morning on Twitter. 14. 22. 65. 62. The reward for fiscal discipline is a strong economic growth even amidst the pandemic. Recurrent spending must be kept at bay, and productive capital expenditure, prioritized. The State House official at the appearance before the committee, presented a budget of N19.7 billion for 2021, out of which N1.3 billion was proposed for the State House Clinic. We are of the opinion that the estimated revenue is overly optimistic and shows that there would be further tax centers by the government in 2020. I will start by asking you to pardon my voice. I am delighted to present the 2020 Federal Budget Proposals to this Joint Session of the National Assembly, being my first budget presentation to this 9th National Assembly. 44. Indeed, the Scheme has attracted private investment of over N205 billion and the first set of tax credits are being processed by the Federal Ministry of Finance, Budget and National Planning. At exactly 11:04am today, President @MBuhari signed into law, the revised N10.8 trillion budget for the year 2020. pic.twitter.com/ydWdJkCsc2, — Bashir Ahmad (@BashirAhmaad) July 10, 2020. Debt service is estimated at N2.45 trillion, and provision for Sinking Fund to retire maturing bonds issued to local contractors is N296 billion. Your email address will not be published. For Nigeria, the coffers are fast depleting given minimal public savings and persistent budget deficits over the years without a concomitant improvement in fiscal revenue generation. Nigeria 2020 Proposed Budget Breakdown. I am confident that with our renewed partnership, the deliberations on the 2020 Budget shall be completed before the end of 2019 so that the Appropriation Act will come into effect by the 1st of January. We estimate that this effort can generate at least 500 million US dollars additional revenue for the Federal Government in 2020, and over one billion dollars from 2021. Despite these anomalies, I am happy to report that we met our debt service obligations, we are current on staff salaries and overhead costs have also been largely covered. Furthermore, the Federal Government (FG) intends to finance the 2020 budget with a higher tax rate as well as other reforms. Nigeria’s Ministry of Foreign Affairs announced in a statement that Dr. Ngozi Okonjo-Iweala secured the support of the majority of the member-nations – but was yet to be declared and returned as the winner, as the United States opposed the consensus. May God bless the Federal Republic of Nigeria. q. Niger Delta Affairs Ministry: N24 billion. An aggregate expenditure of N10.33 trillion is proposed for the Federal Government in 2020. She also said an $80 million loan had been requested on behalf of Ebonyi State government from the Islamic Development Bank for the construction of Abakaliki ring road project, which would connect 13 LGAs in the state as well as the neighbouring Cameroon republic. While the base case scenario indicates a contraction of 4.5% in 2020, the worst-case scenario forecasts a GDP contraction of 7%. 21. President Buhari has drawn a lot of criticisms from Nigerians and various stakeholders over his incessant medical trips abroad and the poor state of the health facilities in the country despite his promise to end medical tourism amongst public officers before his election in 2015. The federal executive meeting had been on hold for a while due to the challenges posed by the coronavirus infection which is usually worsened by physical meetings. 61. Post published: October 16, 2019; Post category: Business / Tax; On October 8, 2019, President Muhammadu Buhari presented the 2020 Budget and Finance Bill to the National Assembly for consideration and passage into law. Likewise, capital expenditure is expected to underperform severely, as the government only achieved a meagre 14% capital spending to aggregate expenditure in 2019. The Budget Office is structured into six departments - six operational departments and three units. However, inflation is expected to remain slightly above single digits in 2020. a. MDAs have not been allowed to admit new projects into their capital budget for 2020, unless adequate provision has been made for the completion of ALL ongoing projects. The efficiency of port operations will also be enhanced by implementing a single customs window, speeding up vessel and cargo handling and issuing more licenses to build modern terminals in existing ports, especially outside Lagos. The WTO said they would continue consultations despite the postponement of the meeting. Despite the delay in capital releases, a deficit of N1.35 trillion was recorded at end of June 2019. The total value of capital imported into Nigeria increased from US$12 billion in the first half year of 2018 to US$14 billion for the same period in 2019.
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