May 6, 2019 – Sunmola David & CO

Federal govt, states, local councils share N617.6 billion for March

Nigeria’s three tiers of government – federal, states and local government councils – shared N617.6 billion as federal allocations for March 2019. A communiqué issued by the Technical sub-committee of the Federation Accounts Allocation Committee (FAAC), at the end of its meeting in Abuja on Tuesday, said the gross statutory revenue received was about N446.6 billion. The figure is lower than the N478.4 billion received in the previous month by about N31.7 billion. Also, the revenue generated from the Value Added Tax (VAT) stood at about N92.2 billion, which showed a marginal decrease of about N4.2 billion from the N96.4 billion generated the previous month. There was also N653 million foreign exchange gain; about N13 billion from Foreign exchange Equalisation; N55 billion from Good & Valuable Consideration as well as N10 billion added by Nigerian National Petroleum Corporation (NNPC). The total distributable revenue for the month came to about N617.6 billion. Consequently, from the net distributable revenue for the month, the federal government received about N257.8; states, N168.3 billion; local government councils, N126.6 billion. The oil-producing states got N49.8 billion as 13 per cent derivation of mineral revenue.The cost of collection, transfer and Federal Inland Revenue Service (FIRS) Refund was about N 15 billion. Also, the distribution of the Value Added Tax (VAT) realised showed the federal government received N13.3 billion, representing 15 per cent; states, N44.2 billion or 50 per cent, while the councils got about N31 billion or 35 per cent. The breakdown of allocation from the statutory revenue generated showed the federal government took N208.4 billion or 52.68 per cent; states, N105.7 billion; councils, N81.5 billion. Other details showed the crude oil export sales increased by about 49.18 per cent due to the increase in lifting volume. This resulted in increased federation revenue by about $240.23 million. The average crude oil price increased from $63.62 to $79.06 per barrel. However, lifting operations were adversely affected by production shut-in, shut -down at various terminals due to technical issues, leaks and maintenance. The committee said there was also a remarkable increase in revenues from oil royalty; import and excise duties increased, while Petroleum Profit Tax (PPT) decreased significantly including Companies Income Tax (CIT). Source: Premium Time

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Firm sues First Bank, FIRS, demands N25bn in damages

An indigenous company, Biatemp Ventures Ltd., has sued First Bank of Nigeria and the Federal Inland Revenue Services (FIRS), demanding N25 billion for special and general damages over alleged manipulation of its domiciliary account and illegal withholding of its tax clearance certificate. In the suit filed before the Federal High Court, Abuja, the company is also seeking the sum of N25 billion for special and general damages arising from the alleged manipulation of the account, business losses due to its withheld tax clearance and embarrassment suffered. In the suit filed on behalf of the plaintiff by Adegboyega Awomolo chamber, the company alleged that First Bank manipulated its domiciliary account with a purported turnover of $6.8 million (about N2.4 billion) leading to the withholding of its 2018 tax clearance by FIRS. The plaintiff said the alleged manipulation of the account was discovered by FIRS intelligence findings when it filed its 2018 tax return forms and awaiting issuance of its tax clearance certificate. The plaintiff stated that rather than issuing the certificate, FIRS accused the company of grossly understating its income. Specifically, the federal revenue collection agency said its intelligence unit discovered that the company had a turnover of over $6.8 million in its corporate account, which was withdrawn by its Chief Executive Officer in about four respective transactions. FIRS, therefore, requested the company to pay a revised tax liability of about $439,000 before the tax clearance could be issued. The plaintiff said it was shocked with the discovery by FIRS because the company never transacted, deposited and withdrew amount of that magnitude in its domiciliary account within the period. It said the deposit made to its domiciliary account within the period was only $22,475 being consultancy fee paid by its client, Forte Upstream Services Ltd. Source: Sun news