• ’NCS can generate N2.5tr yearly’
The House of Representatives on Monday rejected the revenue projections of N1.3 trillion given to the Nigeria Customs Service (NCS) by the Budget Office of the Federation for the 2022 financial year.
The House Committee on Finance said at the resumed interactive session between the lawmakers and government’s Ministries, Department and Agencies, that based on new parameters created by the Finance Act, NCS should be able to generate about N2.5 trillion next year.
The lawmakers also threatened to remove from the budget any government agency that failed to remit 100 per cent of their Internally Generated Revenue (IGR) to the Consolidated Revenue Fund of the Federation.
Comptroller-General, Nigeria Customs Service, Col. Hamid Ibrahim Ali (rtd) had told the committee that they were projecting a revenue of N1.3 trillion for the 2022 fiscal year, down from the N1.6 trillion target it was given this year.
But Chairman of the Committee, Hon. James Abiodun Faleke, queried the rationale behind the reduced estimate and demanded to know from the Budget Office why the target for the agency should be reduced rather than being increased.
Faleke (APC-Lagos) said at the beginning of every year, the Budget Office takes a critical look at expected revenue generation and set expected revenue target for agencies.
He said it is done to know the gap and make preparation for borrowing, saying if more revenue is generated, the amount of money to be borrowed would reduce.
“We are saying no, that your gross revenue generation is low, given all the available opportunities that you have; when you also look at the your previous performance 2020 to 2021.
“For us, as a Committee on Finance, we will not accept the N1.3 trillion, I am sure by the time our report comes out, you will be pleasantly happy,” he said.
Chairman, House Committee on Customs and Excise, Leke Abejide, expressed disappointment with the Customs and Budget Office for the low estimate, which he said, was too small for the agency, considering the parameters which would enable them generate more revenue.
Abejide (ADC-Kogi) said with the recent devaluation of the naira, he expected that the proposal of the NCS should not be less than N2.5 trillion.
He said the exchange rate for 2021 was N381 to a dollar and the targeted revenue generation was N1.6 trillion, saying that the service should factor in the devaluation of the naira and increase its target.
The lawmaker said he was confident that the service would still surpass an upward review target, saying that the new Finance Act has empowered the service to generate more revenue from alcoholic beverages and tobacco as against this year.
In his contribution, Rep. Ahmed Muhktar (APC-Kaduna) said that customs should be able to generate more revenue following the ongoing deployment of technology in revenue collection.
He said with the number of training and retraining lined up in the NCS budget, the service should be able to generate much more than N1.33 trillion, saying that the committee would not accept anything less than N3trillion.
Earlier, Col.Ali told the committee that the service had proposed to generate the sum of N1.33 trillion in 2022.
Ali said the service came up with the figure after analysing the average revenue collection in the previous years and it was trying to be as realistic as possible.
He said: “We are expecting in 2022, N1.33 trillion, that is what we are proposing; we are hoping that things will improve, importation do fluctuate and we do not have any constant measurement so we take the average of what we collected in the previous year and compute it and come up with a figure that is realisable.”
“Whatever comes thereafter, it is our hope that we will surpass it by far but we are trying to be as realistic as we can in our proposal.”
Ali, however, said that should any extra money be generated, it will go straight into the federation account saying that the service has no intention to defraud government.
The Customs boss also told the Lawmakers that out of the N1.6 trillion revenue target given to them for the 2021 fiscal year by the National Assembly, the Service has generated About N1.2 trillion at the end of last month.
Responding to a suggestion by the Chairman of the Committee that the the Service should be able to generate about N2.5 trillion by the end of the year, Ali said “we are targeting about N2.3 trillion by the time end of the year.
He said the service had made several representations to government to approve the collection of excise duty on carbonated drinks which he said endangers lives.
He said: “We are collecting excise on tobacco and alcoholic beverages. The government approved excise for these products because they believe that they are dangerous to the health. I can tell you that these carbonated drinks are more dangerous to the health of Nigerians.”
The House, however, directed the Ministry of Finance to put in place modalities for implementing the Finance Act, which has given permission to the service to start collecting excise on carbonated drinks.
Meanwhile, the Committee has threatened to remove treasury funded agencies that fail to remit their IGR to the Federations Account from the federal budget.
The Finance Committee Chairman who frown at the attitude of Treasury funded agencies with holding money meant for government said the House will debit the Nigeria Investment Promotion Council all the money it illegally spent from its IGR since it was not appropriated for them by the National Assembly.
Faleke told the Accountant General of the Federation to take a decision on whether these agencies should remain Treasury funded or non Treasury funded, adding that “we can remove them from the budget so that they can fund themselves, if that is what they want.
“But if they are funded from the Treasury, they must abide by the law which require them to remit 100 percent of their IGR to the Treasury because it is from that Treasury they draw their operating cost.”
