Delay In Passage Of 2018 Budget Will Affect Nigeria – Adeosun

The Minister of Finance, Mrs Kemi Adeosun, said the delay in passage of the 2018 budget would have some impact on the nation and cause some adjustments in implementation.

She said this during a news conference on Friday in Abuja, adding that the impact was because markets change and the cost of money in the market changes too.

Adeosun, however, said that the Federal Government would try to mitigate the effects of the delay.

“Honestly, we may need to realign some of the priorities now because what we thought we would be doing in January is now different from what we are going to do.

“So, we are going to have to look very closely to see where we would realign and re-prioritise, but we will carry on because most of the capital projects are multiyear projects so we will just continue.

“We are going to try and mitigate that impact as much as possible and focus on completing projects.’’

The minister said the fact that the 2017 budget cycle began late in the year had helped a great deal.

“What has helped us is the fact that the budget was passed late last year, and what we did was we just carried on with those projects, we will close this year’s budget with capital expenses in excess of N1.5 trillion which is higher than last year.

“Many of these projects are multiyear projects, so hopefully, there will not be too much disruptions.’’

Adeosun said that the financial systems were not closed on Dec. 31, 2017 to allow for projects implementation to continue.

She, however, said she was optimistic that the 2018 budget would be passed soon.

On tax, she said the Federal Inland Revenue Service (FIRS), and other tax authorities were doing a lot on enforcement of payment.

She said that the Voluntary Assets and Income Declaration Scheme (VAIDS), had helped in increasing the number of taxpayers captured in the tax base of the nation.

World Bank Officials To Meet Osinbajo, Adeosun, Govs Over Projects In Nigeria

A World Bank mission, comprising 10 executive directors, is expected in Nigeria on Wednesday to hold high-level discussions with the Vice President, Yemi Osinbajo; Minister of Finance, Kemi Adeosun; and some governors over the bank’s projects in the country.

In the World Bank mission are the bank’s Executive Directors for Switzerland, France, Italy, Nordic, Peru, Germany, South Africa (representing Angola, Nigeria and South Africa), Burkina Faso (representing Francophone Sub-Saharan Africa), Zimbabwe (representing Anglophone Sub-Saharan Africa), United Kingdom and Indonesia.

The delegation will discuss ongoing World Bank projects and the country’s development priorities with the vice president, minister of finance and the governors.

The officials will also meet the organised private sector in Lagos as well as undertake a tour of LAPO Microfinance project in Lagos and Azura Power Plant in Edo State.

The visit is expected to provide a first-hand impression of the challenges that both the federal and state governments face in implementing development projects as well as ensuring good governance overall.

It will further enhance the goal of the bank for member-countries and the effectiveness of the executive directors in providing the necessary support.

Adeosun Highlights Details Of IMF World Bank Springs Meetings With CBN Governor

Here are some of the Highlights of the Joint Press Briefing of the Minister of Finance, Mrs Kemi Adeosun and the Central Bank of Nigeria CBN Governor, Mr Godwin Emefiele on the sidelines of the 2018 IMF World Bank Springs Meetings.

Here are some of the highlights as posted on Adeosun’s verified Twitter Handle @HMKemiAdeosun.

The Administration has succeeded in building macroeconomic resilience for Nigeria, particularly revising funding mix, rebuilding fiscal buffers, enhancing foreign exchange reserves and focusing on import substitution strategies.

We will continue to efficiently and effectively manage public sector costs and plug leakages, and make sure that every money that is earned comes in and delivers full value to the Nigerian people.

We are refinancing our inherited debt portfolio from short-term Treasury Bills to longer tenured debt, which has resulted in huge savings and reduction in costs of funds for the Government. We will continue along this path.

The Administration has raised Nigeria’s taxpayer base from 13 million in 2015 to 17 million currently.

The sum of US$322,515,931.83 Abacha funds recovered from the Swiss Government and deposited into a special account in , has been earmarked for the National Social Safety Nets programme of the Government .

At the Briefing Governor Godwin Emefiele disclosed that Nigeria’s foreign reserves have now risen to US$47.93 billion.

The CBN Governor and I jointly affirmed that Nigeria’s positive growth outlook will be sustained. We have come a long way from 2015/16. inflation rate is slowing; foreign reserves are rising. And by 2019, Nigeria’s growth will be far more robust than the present level.


Why I Gave Extra N10billion To National Assembly — Kemi Adeosun

The Minister of Finance, Kemi Adeosun, has reacted to a report detailing how her ministry illegally approved N10 billion for the National Assembly.

The report, published on Friday, indicated that Mrs Adeosun released the billions to the lawmakers despite the N125billion appropriated for the federal legislature in the 2017 fiscal year for recurrent and capital expenditures.

The fund was arbitrarily approved for the lawmakers by the minister in collusion with the Accountant General of the Federation, Ahmed Idris.

Investigations by a news medium who published the report also showed that at least 44 of the 82 contractors the leadership of the National Assembly claimed they were owing were not registered on the National Database of Contractors, a database of the Bureau of Public Procurement (BPP). That means they are not eligible to be awarded federal contracts.

A further check by this newspaper revealed that 17 of the 44 firms were not even registered with the Corporate Affairs Commission (CAC).

In a statement by her media aide, Oluyinka Akintunde, Friday evening, the minister confirmed releasing the fund, but said her action remained legal.

Describing the newspaper’s report as ‘defective,’ Mrs Adeosun claimed that warrants were issued before the billions were moved to the lawmakers.

“The attention of the Honourable Minister of Finance, Mrs. Kemi Adeosun, has been drawn to a smear campaign by an online medium, Premium Times, of “illegally sharing of N10 billion from the national treasury”.

“The Honourable Minister wishes to debunk the entire mischievous and made-up report of the online medium which negates the ethics and professionalism of journalism. The article displays a worrying lack of understanding of Appropriation, Payments and Control, and therefore be disregarded by the public.

“The Minister further wishes to state that warrants are issued in accordance with Appropriation and after due approval by the Cash Plan Committee chaired by the Minister.”

The statement however failed to explain the process of approval for such warrant.

The minister did not also address salient issues such as the release of funds outside the budget and award of contracts to unqualified companies.

Mrs Adeosun did not also explain why she failed to conduct further due diligence by asking for evidence that the contracts were duly awarded before she approved the funds for the lawmakers.

Another explanation the minister failed to make is why her ministry preferred to give N10billion of the N20billion allocated for the payments of federal contractors to the National Assembly which has a budget that covers all its recurrent and capital spendings

$462m Helicopter Purchase: Senate Summons Adeosun, Emefiele

The Senate has invited the Minister of Finance, Mrs. Kemi Adeosun; Minister of Defence, Brig.-Gen. Mansur Dan-Ali (retd.); and Governor, Central Bank of Nigeria, Dr. Godwin Emefiele, over alleged illegal withdrawal of $462m from the Consolidated Revenue Account.

The money was said to have been withdrawn and paid to an American firm for the purchase of helicopters. It was, however, alleged that it was done with the approval of the National Assembly.

At the plenary on Tuesday, Senator Samuel Anyanwu (PDP, Imo-East) raised a point of order, alleging that Section 80(2) and (3) of the 1999 Constitution had been breached.

Anyanwu said, “I have it on good authority that in March 2018, from the Federation Account, a whopping sum of $462m was withdrawn and paid for (the purchase of) helicopters to an American firm. And this is without the approval of the National Assembly or the Senate.

“I know that there was no time when there was any request (for approval) from this Senate before any withdrawal from the Consolidated Federation Account.

“I, therefore, as a senator, want us to find out if that thing (withdrawal) was done.

“I will request and suggest we invite the CBN governor, the Minister of Finance and the Minister of Defence to tell us how this money was withdrawn and paid to an American company — a whopping $462m — without the approval of this Senate.”

Deputy President of the Senate, Ike Ekweremadu, who presided over the plenary, put the request to voice vote and it was unanimously granted.

Ekweremadu referred the matter to the Committee on Appropriations, asking it to invite the ministers and the CBN governor.

“The Appropriations Committee should invite the three: the Minister of Finance, the CBN governor and the Minister of Defence to shed light on the release,” he said.


Nigeria Has The Capability To Repay N21.7tn Debt – Adeosun

The Minister of Finance, Mrs. Kemi Adeosun, has said that the country has enough capability to pay back the debt obligations, which is presently at about N21.7tn.

Adeosun made this known in an interview with some journalists in Abuja on Monday.

She said that the government was not unsettled about the country’s increasing debt as the debt to Gross Domestic Product ratio was still low in comparism with other countries.

The minister stated that unlike previous government that borrowed to pay salaries, the focus of the administration of President Muhammadu Buhari was to invest massively in infrastructure.

She said as of the time that Buhari took over the mantle of leadership in 2015, oil prices were very low and as such, the government was constrained in allocating funds for capital projects without having to borrow.

According to her, with over N2.5tn pumped into infrastructure in the last three years, the country will start seeing the benefits of the borrowed funds.

Adeosun said, “I am not worried at all (about rising debt). Our borrowing is sustainable and well managed. Firstly, we took a decision to reflate the economy. Our borrowing is a true reflection of our economy.

“When your income has gone down, the only place you can go is to borrow. It was a strategic decision. We borrowed and invested heavily in infrastructure and then increased our revenue so that we could pay back the debt.

“It was a deliberate decision. We looked at our budget in terms of size and increased it from N4tn to N7tn so that we could focus on developing our infrastructure.”

She explained that the government’s borrowing was a deliberate policy to stimulate economic activities and take the country away from recession.

She added, “It was a very deliberate policy. It was deliberate because if we do not invest in our capital projects, we cannot grow. If all that the government does is to pay salaries, we will be running at a loss every year. So, it was a strategic decision to tie that money to capital projects.

“One of the differences between our style of borrowing and the previous era when oil prices were at the highest is that in May 2011, the debt was N2.5tn and oil price at that time was $111 to a barrel. By May 2015 when we came in, our debt had risen to N12tn; meaning that in that period when oil prices were highest, the debt doubled but capital releases were very low.

“So, if we should be worried about debt accumulation, it should have been that time. And we should be asking, why were capital releases so low and debt doubled when oil price was so high at over $100 per barrel?

“Yes, there has been acceleration in debt, but there has also been acceleration in capital releases and capital spending.”

Adeosun said if the government continued to get the major projects in power, transport and agriculture off the ground, the economy would continue to experience growth.

She added, “We will have no problem managing our debts because they are sustainable. As the economy grows, we will get everyone to pay their tax so that we will be able to service the debts. If you compare us with any of our neighbouring countries, you will see that we are better than any of our neighbours. We will like to keep it that way.

“There is no sense having no debt, no road, no power and no growth prospect. With the kind of young people that we have and the kind of jobs we want to create, we need to build infrastructure and we cannot use oil money alone to fund our debt.”

Cigarettes, Alcohol To Cost More …As FG Increases Excise Duties

The Federal Government has approved an adjustment to the excise duty rates for alcoholic beverages and tobacco products.

The approval, according to the Minister of Finance, Mrs. Kemi Adeosun, was given by President Muhammadu Buhari, and would begin from Monday, June 4, 2018.

Adeosun, in a statement issued on Sunday in Abuja, said the President had also permitted a period of  90 days (three months) grace to all local manufacturers before the new excise duty regime kicks off.

However, she stated that there would be no increase in excise duty of other locally produced goods.

Adeosun stated that the new excise duty rates were spread over a three-year period from 2018 to 2020 in order to moderate the impact on prices of the products.

Under the newly approved excise duty rates for tobacco in addition to the 20 per cent ad-valorem rate, each stick of cigarette will attract N1 specific rate (N20 per pack of 20 sticks) in 2018, N2 specific rate per stick (N40 per pack of 20 sticks) in 2019 and N2.90k specific rate per stick (N58 per pack of 20 sticks) in 2020.

The minister explained that Nigeria’s cumulative specific excise duty rate for tobacco was 23.2 per cent of the price of the most sold brand, as against 38.14 per cent in Algeria, 36.52 per cent in South Africa and 30 per cent in The Gambia.

The new specific excise duty rate for alcoholic beverages cuts across beer and stout, wines and spirits for the three years covering 2018 to 2020.

Under the new regime, beer and stout will attract N0.30k per centilitre in 2018 and N0.35k per centilitre in 2019 and 2020.

Wines will attract N1.25k per centilitre in 2018 and N1.50k per centilitre in 2019 and 2020, while N1.50k per centilitre has been approved for spirits in 2018, N1.75k per centilitre in 2019 and N2.00k per centilitre in 2020.

The finance minister disclosed that the new excise duty regime followed all-inclusive stakeholder engagements by the Tariff Technical Committee of the Federal Ministry of Finance with key industry stakeholders.

According to her, the upward review of the excise duty rates for alcoholic beverages and tobacco is to achieve a dual benefit of raising the government’s fiscal revenues and reducing the health hazards associated with tobacco-related diseases and alcohol abuse.

She said, “The Tariff Technical Committee recommended the slight adjustment in the excise duty charges after cautious considerations of the government’s fiscal policy measures for 2018 and the reports of the World Bank and the International Monetary Fund’s Technical Assistance Mission on Nigeria’s Fiscal Policy.

“The effect of the excise duty rates adjustment on trade and investment was also assessed by the Federal Ministry of Trade and Investment and it adopted the recommendations of the TTC.

“Furthermore, peer country comparisons were also carried out showing Nigeria as being behind the curve in the review of excise duty rates on alcoholic beverages and tobacco.”

Following the President’s approval, Adeosun stated that the new excise duty rate on tobacco was now a combination of the existing ad-valorem base rate and specific rate, while the ad-valorem rate was replaced with a specific rate for alcoholic beverages.

The minister added, “For alcoholic beverages, the current ad-valorem rate will be replaced with specific rates and spread over three years to moderate the impact on prices. This will curb the discretion in the unit cost analysis for determining the ad-valorem rate and prevent revenue leakages.

“For tobacco, the government will maintain the current ad-valorem rate of 20 per cent and introduce additional specific rates with the implementation to be spread over a three-year period to also reasonably reduce the impact on prices.”

The minister added that the new excise duty regime was in line with the Economic Community of West African States’ directive on the harmonisation of member-states’ legislation on excise duties.

The ECOWAS Council of Ministers at its 62nd and 79th ordinary sessions in Abuja in May 2009 and December 2017, respectively, issued directives on the harmonisation of the member states’ legislation on excise duties.

The directives seek to harmonise member-states’ legislation on excise duties of non-oil products and stipulate the scope of application, rate of taxation, taxable event and amount.

The Director-General, Lagos Chamber of Commerce and Industry, Mr. Muda Yusuf, said the increase in excise duties on the commodities would lead to price hike, while demand would drop.

He stated, “As a matter of general principle, I believe that anybody involved in domestic production at this time needs all the support that the government can give them. First, because of the need to create jobs; unemployment is a very big problem. When you talk about excise duties, you are talking about tax on domestic production.

“We need to be careful about the way we impose taxes on productive activities in the economy. But for tobacco, because of the health hazards that it exposes people to, I don’t mind; the less of it we have, the better. Apart from tobacco, it is not advisable to impose excise on any other activities in the economy, because those who are in the real sector are facing enough troubles already. And we are at a time when we want to create jobs and diversify the economy.”

According to him, there are other manufacturing concerns that are affected by this imposition of excise duties.

“Generally, investors are being over-taxed in this economy, and it is not good for growth, for poverty reduction and job creation. Rather than encourage investors, you are burdening them with taxes at the federal, state and local levels,” Yusuf added.

The Head, Media and Campaign, Environmental Rights Action/Friends of the Earth Nigeria, Mr. Philip Jakpor, described the move to increase the excise duty on tobacco as a welcome development and asked the government to do more.

He said, “This is one of the things we have been demanding for years. When you increase the duties, what you are inadvertently doing is that you are forcing the price of tobacco products to go up. And once it goes up, fewer people will be able to purchase.

“Tobacco is dangerous to health, and the product is cheapest in Nigeria compared to other parts of the world.”

The Registrar, Chartered Institute of Finance and Control of Nigeria, Mr. Godwin Eohoi, said the increase in excise duties on alcohol and tobacco was long overdue.

He stated that with the Federal Government shifting emphasis away from oil revenue, there was a need to increase the rates on other luxury items in the country.

He added that the imposition of additional levies on some of the items would help the government to redistribute income.

133,000 Nigerians, Firms Defaulted Tax Payment Regulations – Adeosun

The data mining efforts of the federal government through the Federal Ministry of Finance has identified a new batch of over 130,000 high net worth individuals and companies that have potential tax underpayments.

The Honourable Minister of Finance, Mrs. Kemi Adeosun, revealed this on Tuesday while appearing on the Good Morning Nigeria programme of the Nigerian Television Authority.

The Minister disclosed that the data was currently being compiled by Project Lighthouse in preparation for the closure of the ongoing Voluntary Assets and Income Declaration Scheme (VAIDS), which ends on 31st March, 2018.

Project Lighthouse is a unique project of the Federal Ministry of Finance that combines data from federal and state agencies and overseas countries.

She said, “The data have been received from a number of sources including land registries of the governments of Lagos, Kaduna, Kano and Ogun States as well as the Federal Capital Territory.

“In addition, Nigeria has been able to request data from a number of nations including traditional tax havens. The data have been received from a number of foreign jurisdictions under the exchange of information protocols.

“Under the exchange of information protocols, this information relates to bank records and financial filings for tax purposes and is obtained from tax havens who are signatories to the information sharing agreements such as British Virgin Islands and Mauritius.”

She explained that the data received from overseas countries would only be used for taxation purposes in line with the protocols governing the exchange of information

“The sole interest of the federal and state governments in the use of the data is in raising tax revenues. There is absolutely no hidden agenda on the use of the data,” she added.

Mrs. Adeosun hailed the ‘unprecedented’ level of cooperation between the federal and state governments, which she said was a marked change from the past when the various arms of government did not align their efforts.

She identified the common violations by non-compliant tax payers to include:

· Under-declaration of and non-declaration of income earned including income from government contracts and overseas trading;

· Collection of Value Added Tax (VAT) which is not duly remitted to FIRS;

· Charging of non-allowable personal expenses to company accounts particularly with reference to overseas school fees;

· Inconsistency between income declared for tax purposes and the value of assets owned.

She advised non-compliant tax payers to seek professional advice and to also consult relevant literature available from the tax authorities on tax rules.

She underscored the federal government’s commitment to raising tax revenues which were essential to grow the economy and create jobs for Nigerians.

She cited the fact that just N1 million could feed over 14,200 primary school children under the Homegrown School Feeding programme as well as creating many jobs in the agricultural sector.

Asked if the federal government would extend the deadline of the tax amnesty programme, the minister ruled out an extension of the deadline saying sufficient period had been given to tax payers to voluntary and truthfully declare their assets and income which had not been declared previously.

On the economy, she assured that the country was on the path of growth.

Nigeria, it would be recalled, had exited recession in the second quarter of 2017, recording a growth of 0.72 per cent.

The country further consolidated its recovery in the third and fourth quarters of last year, with growths of 1.40 per cent and 1.92 per cent, respectively.

Mrs. Adeosun said, “The administration of President Muhammadu Buhari has laid the foundation for the repositioning of the economy by a series of reforms which are being sequenced to ensure maximum impact and benefits to Nigeria and the citizens.

“These include huge investments in infrastructure and social welfare across the country, improved revenue mobilisation, rebuilding of foreign reserves and stabilization of exchange rate.”

She further noted that revenue mobilisation was potentially the master key to unlocking Nigeria’s huge growth potentials and funding the infrastructure programmes.

In addition, the minister said the federal government would continue to create more fiscal space for reforms to enhance productivity and opportunity in the non-oil sector.

VAIDS: March 31st Remains The Deadline – FG

The Minister of Finance, Mrs Kemi Adeosun on Tuesday has debunked the news that the Federal Government would extend the March 31 deadline of the Voluntary Assets and Income Declaration Scheme.

She said this while during an  interview at a live breakfast show “Good Morning Nigeria” aired by the Nigeria Television Authority.

The VAIDs programme offers a grace period from July 1, 2017, to March 31, 2018, for tax defaulters to freely give back all they owe the government.

In exchange for full and honest declaration, the government promises to waive penalties that should have been levied and also waive the interest that should have been paid on overdue tax.

Also, those who declare their tax obligation honestly would not be subjected to any investigation or tax audit after the nine-month grace period.

There had been pressure on the presidency within the last few days by some former governors, top politicians, high profile individuals, business owners and professional bodies among others seeking an extension of the scheme.

But Adeosun said that the government would not extend the tax amnesty program. She said the Federal Government had been magnanimous enough by granting the nine months tax amnesty to tax defaulters adding that those who are interested in the scheme still have about three weeks to come out voluntarily to declare their income.

We Will Name, Shame Tax Evaders Next Month – Adeosun

The Federal Government has revealed plans to aggressively go after tax evaders to prosecute them and publicly reveal their identities.

Through the Ministry of Finance, the Federal Government said tax evaders will be prosecuted, named and shamed using its the Voluntary Assets and Income Declaration Scheme (VAIDS) which will end by March 31, this year.

The Minister of Finance, Kemi Adeosun said this on Thursday during the VAIDS Stakeholders symposium which held at the Shehu Yar’Adua Centre, Murtala Square, in Kaduna State.

According to her, the Federal Government has the political will and data to go after tax evaders who fail to take advantage of the tax amnesty programme.

“We will close VAIDS at the expiration of the programme on March 31, 2018. And once the programme is closed, we will name and shame and also prosecute tax evaders.

“Many Nigerians cannot explain their lifestyles or match their lifestyles, assets and income with their tax payment,” she said.

VAIDS, Adesoun explained, has been strengthened by the data on financial accounts, property and trusts shared by other countries. She said the programme will aid in recovering funds to provide basic needs for Nigerians.

“The offshore tax shelter system is basically over. Those who have hidden money overseas are being exposed and whilst Nigerians can legally keep their money anywhere in the world.

“They must first pay any taxes due to the Nigerian government so that we can fund the needs of the masses and create jobs and wealth for our people.”

Adeosun also said she is displeased with the six percent tax to gross domestic ratio for Nigeria. This, she explained is one of the lowest in the world

“We cannot be in the bottom division when it comes to tax collection and expect to be in the premium when it comes to development, it can’t work and so, we must come together as one and do the right thing,” she said.

Missing N10bn NHIS Fund: Reps Summon Adeosun, Emefiele

The House of Representatives committee on healthcare services has invited the Minister of Finance, Kemi Adeosun and the Governor of the Central Bank of Nigeria (CBN) Godwin Emefiele over N10 billion said to have been deducted from the National Health Insurance Scheme (NHIS).

Also summoned were the Minister of National Planning, Senator Udoma Udo-Udoma and the Director General of the Budget Office of the Federation, Mr. Ben Akabueze.

The deductions, which became a public issue just as the reinstated Executive Secretary of the NHIS, Prof. Usman Yusuf, resumed duty, had generated a fresh controversy at the agency.

It had initially been tagged as “missing,” prompting the House Committee on Healthcare Services summoning Yusuf on Wednesday to explain what happened to the N10bn.

The panel, headed by Hon Chike Okafor (APC, Imo) said the amount was domiciled at the CBN but appeared to be deducted ‘arbitrarily’.

The money was taken in two tranches of N5bn in December 2016 and N5bn in January, 2018.

Executive Secretary of NHIS, Prof Yusuf Usmam, speaking before the committee, described the allegations as “misleading and irresponsible”, stating that N10bn missing was deducted from the NHIS Treasury Single Account, as unremitted revenue, by the Federal Ministry of Finance between December 2016 and January 2018

He said the transaction was done in two tranches, with N5bn deducted in each of the transactions in December last year and January this year.

Yusuf said “In December 1, 2016, NHIS got a memo from the Federal Ministry of Finance stating that NHIS is a revenue generating agency.

“I went to the minister and the Accountant-General of the Federation and told them that NHIS is not a revenue generating agency. “On 28 December, 2016, N5bn was deducted from the NHIS Account; another N5bn was deducted on 11 January, 2018, totalling N10bn.

“The money was deducted as surplus unremitted revenue from the agency. I don’t know whether it has been used or what it was used for,” he told the panel.

The committee chairman, Okafor said the panel would get to the bottom of the matter to ascertain how and why the amount was deducted.

The committee insisted on hearing from Adeosun, Adewole, Udo-Udoma, Emefiele, Idris and Akabueze before deciding on the next line of action to take.

The motion was immediately endorsed by the session to summon the aforementioned officials of government.