FAAC: Nine States share N84.642bn derivation proceeds

Nine States share N84.642bn derivation proceeds - nigerian newspapers headlines today

Despite suffering a sharp decline in revenue available to the three tiers of government to share for August 2022 from the Federation Account, nine oil-producing States on Friday in Abuja went home with N84.642 billion as derivation proceeds.

Under the 13 percent derivation principle, Delta received N27 billion; Rivers N14.9 billion, Akwa Ibom N17 billion and Bayelsa N16 billion.

Edi got N3.7 billion; Ondo N2.304 billion; Imo N1.44 billion; Anambra N413.557 million and Abia with N287,877 million.

The Federation Account Allocation Committee (FAAC) however shared a total of N673.137 billion August 2022 Federation Account Revenue to the Federal Government, States and Local Government Councils.

This was contained in a communiqué issued at the end of the Federation Account Allocation Committee (FAAC) meeting for September 2022.

The N673.137 billion shared for August 2022 was a far cry from the N954.085 billion the three tiers of government shared last month.

As a result, Non Oil Excess Revenue had to be harvested to augment for the shortfall in revenue shared for August.

In other words, the N673.137 billion shared in Abuja was made up of Gross Statutory Revenue, Value Added Tax (VAT), and an Augmentation of Non Oil Excess Revenue.

A member of FAAC, who confirmed the drop in allocation to the three tiers of government, attributed it to the Nigeria National Petroleum Company limited not remitting any money into the account.

The source also confirmed the N84 billion that was allocated to the nine oil producing states as 13 percent derivation while the communiqué quoted N26.301 billion as derivation figures.The N673.137 billion total distributable revenue comprised distributable statutory revenue of N437.871 billion, distributable Value Added Tax (VAT) revenue of N215.266 billion and augmentation of N20.000 billion from the Non-Oil Excess Revenue.

According to the communiqué, “in August 2022, the total deductions for cost of collection was N35.487 billion and total deductions for transfers and refunds was N176.907 billion.

The balance in the Excess Crude Account (ECA) was $470,599.54.

The communiqué confirmed that from the total distributable revenue of N673.137 billion; the Federal Government received N259.641 billion, the State Governments received N222.949 billion and the Local Government Councils received N164.247 billion. The sum of N26.301 billion was shared to the relevant States as 13% derivation revenue.

Gross statutory revenue of N654.360 billion was received for the month of August 2022. This was lower than the sum of N1,066.845 billion received in the previous month by N412.485 billion.

From the N437.871 billion distributable statutory revenue, the Federal Government received N216.815 billion, the State Governments received N109.972 billion and the Local Government Councils received N84.783 billion. The sum of N26.301 billion was shared to the relevant States as 13% derivation revenue.

For the month of August 2022, the gross revenue available from the Value Added Tax (VAT) was N231.171 billion. This was higher than the N190.256 billion available in the month of July 2022 by N40.915 billion.

The Federal Government received N32.290 billion, the State Governments received N107.633 billion and the Local Government Councils received N75.343 billion from the N215.266 billion distributable Value Added Tax (VAT) revenue.

The N20.000 billion augmentation from the Non-Oil Excess Revenue was distributed as follows: the Federal Government received N10.536 billion, the State Governments received N5.344 billion and the Local Government Councils received N4.120 billion.

According to the communiqué, in August 2022, Value Added Tax (VAT), Import and Excise Duties recorded significant increases. However, Petroleum Profit Tax (PPT), Companies Income Tax (CIT), Oil and Gas Royalties decreased considerably.

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