States won’t borrow again as FAAC shares N558.0bn for September

State governments would henceforth seek ways of cutting costs and working closely with the federal government to increase non-oil revenue particularly Value Added tax (VAT), withholding tax and stamp duty so that at the end of the day, states will make more money.

Chairman of the Finance Commissioners forum, Mr Mahmood Yunusa of Adamawa state disclosed the resolve of states on behalf of his colleagues shortly after the monthly meeting of Federation Account Allocation Committee (FAAC) meeting on Tuesday where a total N558.082 was shared among the three tiers of government.

“States are not looking at borrowing to augment the funding gaps”, he declared while answering a question on how they intend to bridge funding gaps currently incapacitating them from meeting their basic financial obligations.

Earlier, Accountant General of the Federation Mr Idris Ahmed disclosed that “the total revenue distributable for the month of September including VAT, was N558.082 billion.

From this amount, the federal government pocketed N234.286 billion, states and the Federal Capital Territory (FCT) got, N152.739 billion, local governments councils received N114.918 billion. Oil mineral producing states got an additional N40.216 billion under the 13 per cent derivation principle.

Idris Ahmed noted that gross statutory revenue of N423.961 billion received for the month was lower than the N550.992 billion received in the previous month by N127.023 billion.

The AGF noted that “there was significant increase in revenue from export sales of $176.4 million due to an increase in crude oil production by 4.12 million barrels. However, the average price of crude oil decreased from $50.44 to $46.29 per barrel.”

Idris Ahmed added that “activities resumed at Forcados Terminal for the first time since February 2016. There were shut-ins and shut-downs at Terminals for maintenance and repairs.”

Oil royalty  he said recorded significant increase in the month under review but there was considerable decline decline in revenue from companies Income tax , petroleum profit tax, import duty and VAT.”

It was also revealed that the balance in the Excess Crude Account (ECA) still stands at $2.309 billion while the balance in the excess ppt stands at $68 million as at 20th October, 2017.