The Senate says it plans to reduce the import duties waivers proposed for the N19.76 trillion 2023 budget with an attendant deficit of N12.4 trillion.
Chairman of the Senate committee on finance, Solomon Adeola, disclosed this on Tuesday at an interactive session on the N6 trillion proposed import waiver for companies in the 2023-2025 Medium Term Expenditure Framework (MTEF) and Fiscal Strategy Paper(FSP) with revenue generating agencies.
Mr Adeola said the reduction became necessary, given the projected deficit of N12.4 trillion in the 2023 budget estimates and the current dwindling revenue profile of the nation.
“About six trillion was provided as a waiver for companies in the 2023 proposal, but we should reduce it by 50 per cent. I don’t think we can accommodate that. We need to reduce the six trillion waiver by 50 per cent,” the legislator stated.
He also urged the finance ministry to place 63 government-owned enterprises (GOEs) on the cost of collection to fund their expenditures immediately. He said this would generate more revenue to fund the deficit envisaged in the 2023 budget.
According to him, placing the agencies on the cost of collection would spur the GOEs to collect more because the more they generate, the more they receive. The lawmaker called for a review of pioneer legislation status on some companies’ taxes in the last five years.
The Minister of Finance, Budget and National Planning, Zainab Ahmed, in her presentation on the overview of 2023-2025 MTEF/FSP, disclosed that President Muhammadu Buhari’s revenue for 2023 was projected at N6.34 trillion.
According to her, N373.17 billion would be generated from oil sources, while the balance of N5.97trillion would be earned from non-oil sources.
She also said the budget deficit for 2023 was projected to be N12.41 trillion, while the federal government’s 2023 aggregate expenditures were projected to be N19.76 trillion.
Responding to questions from senators, the finance minister said it was the assumption of the regime that fuel subsidy would be exited by June 2023.
“One of the ways to increase our revenue is to strengthen our monetary generating enterprises and to provide real sanctions to defaulters based on the fiscal responsibility act,” Ms Ahmed stated.
On issuing tax credits to some companies and waivers, she noted that “tax credits are issued only when companies construct projects and the projects are certified and certificate issued by the Federal Ministry of Works.”