Speaking with stakeholders on the sidelines of the 2021 Finance Bill in Abuja, Ahmed hinted that the Buhari-led government is considering modest increases in taxes and tariffs on certain businesses and individuals over the medium term.

While noting that a couple of reforms and amendments had been recommended in the draft 2021 finance amendment bill, she said more will be introduced in the middle of 2022.

Speaking further, the minister said more fiscal reforms were still in view as the ministry could not take all the proposals collected from stakeholders.

Her words: “While these issues may require most increases in taxes and tariffs on certain businesses, industries, and individuals over the medium term.

“Our aspiration is to do a midterm review with a possibility of another Finance Bill in mid-year 2022 to bring in more amendments.”

Should Nigerians be worried?

This is the worst that the Nigerian citizenry could expect from the government, especially as the world is still battling the effect of the raging COVID-19 pandemic.

It is, therefore, noteworthy to mention that in the midst of this looming development, food prices are skyrocketing at apocalyptic rate, inflation is not favourable to an average Nigerian, and electricity consumption tariffs have gone beyond the roof, wages remain stagnated, and not paid as at when due.

While the incumbent administration may have rationalise these taxes and levies on the grounds that they would aid infrastructures, uncertainty surrounds how advocates of these higher taxes and levies hope the people can endure for much longer.

The post Buhari To Impose New Taxes, Increased Tariffs On Nigerians Next Year appeared first on Business News in Nigeria.

This development came amid the recession Nigeria just plunged into.

With the economic downturn, stakeholders in the manufacturing sector, including those under the auspices of Manufacturers’ Association of Nigeria’s Export Group, Abuja Chamber of Commerce and Industry (ACCI), have in separate in interviews blamed the President Muhammadu Buhari-led government.

They unanimously agued that should land border not be closed as it has been, the economy would be functioning well.

According to the stakeholders, the closure of land borders was not a smart move, as it will definitely have a negatively impact on the economy, especially when the country suffering from the recession.

Ede Dafionone, The President of MAN’s Export Group, said that the uncertainties shrouding the prolonged border closure influenced investment decisions of manufacturers.

He said: “It is actually difficult to have an exact measurement of its impact because there are some companies that have reported that it has helped their businesses because  fake and cheap imports were stopped and there are some exporters who have complained that the border closure has affected their businesses drastically.

“What is very clear is that the sudden prolonged and unanticipated closure of the border is bad for business because of the business community cannot make projections at all for production for export. That uncertainty is clearly bad for long term investments. In that sense, it is definitely bad for the economy.”

He however advised the governmenton the need to earn goodwill by re-opening the borders.

ACCI Director, Adetokunbo Kayode maintained that the decision made by the government to close the borders without talking with the private sector players was very bad.

He said: “The border closure had multiplier base. One is that the decision was taken without consultation, which we think is wrong decision. Government was actually about to review it before the pandemic came and it had to lock up.

“You see, there is no perfect decision or policy or government. So when you are wrong just accept, because it is like being in a hole, in such a situation you don’t have to continue digging but to find a way to get out.”

similarly, Muda Yusuf, LCCI Director, said that both losers and beneficiaries arose from the closure of the border.

He said: “Poultry and rice farmers have reported an improvement in sales arising from the border closure, while investors engaged in cross-border trade in the sub-region lamented on the closure. Traders, manufacturers, freight forwarders and transporters, who operate across the land borders, were negatively affected.”

Without mincing words, Bongi Adi, a senior lecturer at the Lagos Business School, said he was yet to see the economic reason behind the closure of the border.

Adi said: “What we have seen is that the government opened that borders for some firms in Nigeria which means it is not based on economic gains. It was opened to serve some sort of political, self-serving, and parochial interests. This is simply because the government wanted to give access to their people or create some kind of preferential treatment.”

Meanwhile, the Minister of Finance, Budget and National Planning, Zainab Ahmed, asserted that the committee on border closure set up by the President, Major would submit its report soon.

It can be recalled that on August 20, 2019, the government closed land borders to put an end to smuggling in the country and boost local production.

The closure also required that neighbouring countries check smuggling from their own end.

To this effect,The President set up a ministerial committee consisting of Zainab Ahmed, Rauf Aregbesola, Geoffrey J Onyeama, as well as heads of immigration and customs to assess the decision.

It came as a surprise that after more than a year, the committee was yet to submit its report to the President.

Now that their attention has been drawn, ahmed maintained that  the presidential committee set up on the matter had completed its job and would soon submit its report.

She said, “Mr President has set up a committee that I chair, alongside the minister of foreign affairs and other ministers including interior and agencies such  customs, immigration and other security services to review and advise him on the issue of border closure.

“The committee has just completed its work and we will be submitting our report.

“I have signed my copy; I gave everybody to sign between today (Wednesday) and tomorrow (Thursday) so that we submit the report to Mr President.”

However, the minister did not disclose when the report would be submitted and how soon the land borders will be reopened.

Ahmed also  disclosed that the Federal Government  had no plan to withdraw the 2021 Appropriation Bill from the National Assembly because of recession, as proposed by some groups and individuals. Rather, the government would be using the Economic Sustainability Plan(ESP) to revive the economy.

While addressing the current recession situation in the country, the minister explained that the ESP was designed  for that course.

Her words: “You will recall that the ESP was designed to be a 12 months plan, to act as a bridge between the ERGP and its successor plan. But also, it was designed specifically to help us quickly exit recession, which we had projected was going to happen.

“So, the ESP implementation is really on course; it’s focused and also the implementation of the 2020 budget is really on course and is very focused.

“We have been able to release a large volume of capital funding into ministries, departments and agencies, enabling a lot of public work going on simultaneously all over the country.”

The post Stakeholders Fault FG Over Poor Economic Performance appeared first on Business News in Nigeria.

While speaking on the development,the Minister of Finance, Budget, and National Planning, Zainab Ahmed said that the reduction in import duties and levies is aimed at reducing the cost of transportation.

She said: “The reason for us is to reduce the cost of transportation which is a major driver of inflation especially food production.”

Recall that the Federal Government imposed a 35% import levy on cars and 35% duty making importers pay a total of 70% of the cost of a new car as levy and duty.

Without thinking about the pockets of citizens, the government went ahead to place a costly levy on vehicles thereby compelling people to buy cars in Nigeria.

This policy however heightened the rate of smuggling and discouraged importers as they had diverted their importations to neighboring countries.

However, with the new policy in place, it is pertinent to note that the bill shared by the presidency, states that the import duty of tractors and motor vehicles for the transportation of goods has been slashed from 35% to 10%.

Once the draft Bill of the 2020 Finance Bill is approved by the Federal Executive Council (FEC), it will then become law after it is passed by the legislature and signed by President Muhammadu Buhari.

What this means

 Import duties are one of the essential tools used to reduce importation or restrict foreign trade in the country.

Asides from the fact that it will encourage more people to pay their duty and make vehicles available to Nigerians, it will also make the country earn more revenue to the growth of the economy.

The post Why FG’s Reduction Of Levy On Imported Cars Is A Smart Decision appeared first on Business News in Nigeria.

The minister recounted that the total public debt stock of the country, which comprises foreign and local debts stood at N31.01 trillion as of June 30, 2020, as she expressed confidence that the FG will borrow more funds to run the economy next year.

“The total public debt stock comprising the external and home debts of the federal and state governments and the Federal Capital Territory stood at N31.01 trillion ($85.90 billion) as of June 30, 2020.

“It is projected, based on existing approval, to rise to N32.51tn by December 31, 2020, and N38.68 trillion by December 31, 2021,” Ahmed stated.

Among some of the bodies that have fumed at the incumbent administration of the country’s consistency with securing loans is –Lagos Chamber of Commerce and Industry (LCCI).

Raising alarm over the increasing debt profile, Toki Mabogunje, the President of LCCI, stated that the country’s debt is fast becoming unsustainable.

Making reference to the Debt Management Office (DMO), Mabogunje explained that the increase in Nigeria’s public debt was because of the fresh domestic and external borrowing, which she noted were meant to connect the wide fiscal deficit in the revised 2020 budget given the economic impact of COVID-19 and recent exchange rate devaluation.

Nigeria’s alarming portfolio

Recall that some months ago, DMO released the country’s debt report.

In the report, Unmask NG learnt that Nigeria’s total debt stock, which comprises foreign and local arrears, as at June 2020 stood at N31.01 trillion, which represents 8.31% increase when compared to her N28.63 trillion debt profile as at March 2020 (three months prior).

Out of the N31.01 trillion debt profile, external debt stood at N11.36 trillion, representing 36.65% of the total debt stock. On the other hand, domestic debt at N19.65 trillion, representing 63.35% of the total debt.

The DMO report also disclosed that N1.21 trillion was spent to service the loans during the period under review. While domestic debt servicing gulped N921.9 billion, the government spent N288.6 billion to service its foreign debts.

Here’s what you should know

In spite of concerns from economic experts, industry players and stakeholders, and international bodies, President Muhammadu Buhari-led government has channeled its focus on borrowings and adding to Nigeria’s alarming debt stock.

From recent comments by officers in Buhari’s cabinet, it is pretty much obvious that loans seem to be the only way the incumbent administration can secure funds to keep the economy running.

But the reality is, should the government continue on this trend, the increasing debt would not stop to disrupt large investments on infrastructures, which are meant to stimulate productivity and improve the standard of living of the people.

The post Despite N31trn Debt, FG Eyes Fresh N6trn Loan appeared first on Business News in Nigeria.

NBS disclosed in the publication that the President Muhammadu Buhari-led administration, recorded a 20.92% year on year growth after the combined state’s IGR stood at N1.33 trillion in the period under review, from N1.17 trillion in 2018.

Here’s what you should know 

Lagos State topped the highest earners of the 2019 IGR, having recorded N398.73 billion. While Rivers State maintained the second spot on the list with N140.40 billion IGR, Taraba State recorded the least IGR after grossing N6.5 billion.

See complete details of the IGR below:

The post NBS Releases Nigeria’s 2019 IGR [See State’s Earnings] appeared first on Business News in Nigeria.

Nevin had stated; “There is a possibility that at least for three to five years, there’s going to be no revenue flowing to the government from oil.” This simply means that the Nigerian government has to look elsewhere to get revenue to fund infrastructure projects amongst other things.

Speaking on the economic woes, Zainab Ahmed, the Finance Minister, had admitted that the President Muhammadu Buhari-led administration is faced with a twin challenge of dealing with the Covid-19 pandemic itself, and a slump in the price of crude.

“It’s a double whammy,” she said. “This has set us back significantly.”

Unarguably, global efforts to curtail the spread of the infectious disease have driven oil prices so low that they no longer cover the cost of pumping barrels for many companies in Nigeria — let alone providing the government with crucial cash.

Lost earnings

Nigeria kicked off the year projecting it would sell oil at $57 a barrel, then it revised that down to $30 a barrel, and then $20. And according to the IMF, Oil revenues will decline by $26.5 billion this year, down from $54.5 billion in 2019.

“This is a period of crisis,” said Fortune Obi, who works for Shell Nigeria and is a spokesman of the country’s oil union for senior workers. “Job losses are imminent across the petroleum industry. The impact of this will start reflecting from June and July. The reality is that some members will certainly be impacted. What matters most to us is how to manage the process of any such expected exit.”

The post Amid COVID-19 Spread, Nigeria Loses Earnings As Oil Revenues Plunged appeared first on Business News in Nigeria.