Economy

FAAC disbursed N275.33 billion to FG in February

The Federation Account Allocation Committee (FAAC) disbursed the sum of N275.33 billion to the Federal Government in February 2019, the National Bureau of Statistics (NBS) has disclosed.

The NBS said this in FAAC February 2019 Disbursement statistics posted on its website.

According to the bureau, the states received a total of N182.17 billion while the Local Governments received N136.88 billion in the month under review.

The sum of N660.37 billion was disbursed to the three tiers of government in February, 2019 from the revenue generated in January, 2019.

The report said the amount disbursed comprised N497.12 billion from the Statutory Account; N104.47 billion from Valued Added Tax (VAT) and N8.12 billion as excess charges recovered.

According the report, the sum of N50 billion was distributed as FOREX Equalisation Fund and N654.70 million as exchange gain differences.

The sum of N48.49 billion was shared among the oil producing states as 13 per cent derivation fund.

Revenue generating agencies such as Nigeria Customs Service (NCS), Federal Inland Revenue Service (FIRS) and Department of Petroleum Resources (DPR) received N5.66 billion, N7.62 billion and N4.07 billion as cost of revenue collections.

Further breakdown of revenue allocation distribution to the Federal Government of Nigeria revealed that the sum of N221.33 billion was disbursed to the Federal Government consolidated revenue account.

In addition, the sum of N4.94 billion was disbursed as share of derivation and ecology and N2.47 billion as stabilisation fund.

Also, the sum of N8.30 billion was shared for the development of natural resources and N5.90 billion to the Federal Capital Territory (FCT) Abuja.

The Nigerian government financial system operates a structure where funds flow to the three systems of government from what is termed the FEDERATION ACCOUNT.

The Federation Account serves as the central pocket through which the Governments – Federal, States, and Local Governments – fund developmental projects as well as maintain their respective workforce.

The flow of revenue into the Federation Account includes oil revenues and related taxes, revenues generated from the NCS trade facilitation activities, company income tax (CIT), any sale of national assets, surplus and dividends from States Owned Enterprises.

Fundamentally, there are two components of the revenue allocation formula used for the disbursement of the Federation Account to the three tiers of government.

These are Vertical Allocation Formula and Horizontal Allocation Formula.

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