Finance minister calls for intensified efforts to boost revenue

Finance minister calls for intensified efforts to boost revenue

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Nigeria’s minister of finance, Zainab Ahmed, has called for intensified efforts to boost revenue generation in line with President Muhammadu Buhari’s emphasis at his 2019 budget speech.

Speaking at the quarterly world press conference held in Abuja, the minister discussing the trends and achievements of the economy over the last quarter, underscored the vital role of domestic revenue mobilisation for continued economic success and inclusive growth in Nigeria.

Pointing to the directive of the President for the acceleration of all revenue initiatives, Ahmed said, “The time to act is now – if we do not address the long standing issue of ‘unsatisfactory revenue performance’ in our country, particularly in the non-oil sector, we will never realize our shared goal of ensuring appropriate financing for critical sectors such as health, education, infrastructure, and ultimately to co-creating a Nigeria leaving no one behind.”

As minister of finance, Ahmed has taken on the President’s important call to action by prioritising revenue generation and formally launching in January 2019 the Strategic Revenue Growth Initiatives (SRGI), a suite of comprehensive cross-cutting interventions aimed at boosting revenue performance.

Since the launch of the initiative, revenue performance, in her opinion, continues to show improvements, with revenues amounting to N3.96trillion as at the end of fourth-quarter (Q4) 2018, this represents a 31percent increase over the performance in 2017. However, this performance of 3.96 trillion still falls short of this Administration’s budgeted target as the aggregate revenue performance is still only 55percent of the projected revenue of N7.16 trillion.

Consequently, the Ministry of Finance would continue to prioritize revenue generation, and the implementation of the Strategic Revenue Growth Initiatives (SRGI).

Whereas there has been progress since the launch of the initiatives, the global economy, as anticipated, has slowed down in 2019 with a revised growth projection of 3.3percent. This trajectory, according to her, is mirrored in Africa, with the continent projected to grow slightly more at 3.5 percent in this same year.

In her brief review of the global and domestic economic trends, she notes that commodity based economies, including Nigeria, are expected to continue recovery from the rapid commodity crash witnessed from 2014 to 2016.

In her words: “This development represents challenging times amidst this year’s volatility in oil prices that has fallen from $86/barrel in October to $62/barrel in December and it is fortunate that the price has risen to a five-month high of above $71/barrel as the end of April 2019.”

Her position is that while oil prices are expected to remain within the range of $70/barrel, continued volatility is envisaged throughout the year 2019. Meanwhile the Federal Ministry of Finance is focused on taking key mitigating actions to safeguard the economy and ensure it is resilient to external shocks as it continues to monitor key global risks.

Having taken the issue of revenue generation very seriously, some more light was shed on the enhancement of customs collection, being a project to automate the import duty exemption certificate (IDEC) application process. This was brought to fruition in the Q2 2019. The platform is meant to ease the application and approval process, further improving the turnaround time by over 500percent.

She noted: “Before proposed automation, it takes an average of 60 days to process one IDEC certificate. But we expect the platform to cut that down to 1-2 weeks, at the barest minimum.

The platform has undergone a redesign and initial implementation stages. Currently, it is at the final testing phase. So, Director Technical Services has been charged to ensure that the process is completed within the next one month.”

In her words: “We have also implemented several initiatives targeted at the recovery of various revenues due to leakages. Going forward, we plan to launch Project Lighthouse that seeks to make use of big data analytics to provide intelligence to the tax authority on eligible taxpayers and their real taxable incomes and assets.

“As we plan to roll out the IPPIS for all other MDAs in 2019 and optimize Government Integrated Financial Management Information System (GIFMIS), we are set for an improved PFM system that ensures an efficient and cost effective public service delivery for our citizens.”

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