Some economic experts have expressed concern over the Federal Government\u2019s decision to base the estimated revenue from Value Added Tax (VAT) in 2020 on 7.5 per cent instead of five per cent.
\nDr Patricia Auta, an Economic Analyst, while reacting to the N10.33 trillion budget submitted to the National Assembly yesterday in Abuja said that the government had acted prematurely in using 7.5 per cent instead of five per cent.
\nHe told our correspondent that the proposed hike in VAT would have to be approve by the National Assembly before it comes into effect, adding that it had not been done.
\nAccording to him, the government should not have used it in calculating its revenue estimates.
\n\u201cIt\u2019s my opinion that the government cannot just assume that the National Assembly will approve the VAT increment from five per cent to 7.5 per cent.
\n\u201cAs much as it\u2019s important for the government to increase its tax revenue, increasing VAT is not the right way to go.
\n\u201cVAT is a multi-level tax on consumption and the burden rest on the final consumer and not the business so the people are the ones who will bear the brunt of the increase.
\n\u201cGovernment needs to pay attention to expanding the tax net and ensure that businesses pay tax, especially those multinational companies. That\u2019s where the money is,\u201d she said.
\nAnother expert, Mr. Jibrin Ibrahim said that the government was overly optimistic in their revenue targets, which includes the VAT component.
\nHe said that as much as increasing revenue was important, it should not be done at the expense of the people.
\nIbrahim also expressed his concern over the sum allocated to education and health compared to other sectors.
\nHe said with the infrastructure gap in the education and health sectors, it was surprising that only N48 billion was budgeted for Education and N46 billion for Health, out of the N2.46 trillion earmarked for Capital Expenditure.
\nIbrahim urged the National Assembly to examine the major components of the budget for the benefit and development of the nation.
\nPresident Muhammadu Buhari yesterday presented a budget proposal of N10.33 trillion to a joint session of the National Assembly.
\nBuhari puts the Federal Government\u2019s estimated revenue in 2020 at N8.155 trillion, comprising oil revenue of N2.64 trillion, non-oil tax revenues of N1.81 trillion and other revenue of N3.7 trillion.
\nPresident Buhari said debt servicing in the 2020 budget will gulp N2.45trn, out of which local debts would take N296bn.
\nOverhead cost will be N426.6bn, he said.
\nOther estimates are N556.7 billion for statutory transfers; N2.45 trillion for debt servicing and provision of N296 billion as sinking fund.
\nThe 2020 budget is based on an oil production estimate of 2.18 million barrels per day, oil price benchmark of 57 dollars per barrel and an exchange rate of N305 to a dollar.
\nOther benchmarks are: real Gross Domestic Product (GDP), growth rate of 2.93 per cent while inflation rate \u201cis expected to remain slightly above single digits in 2020\u2019\u2019.
\nMr. President during the declaration said that N125 billion was allocated to the National Assembly while N110 billion was allocated to the Judiciary.
\nFor allocations to ministries, the president affirmed the following allocations to respective ministries.
\nWorks and Housing \u2013 N262 billion, Transportation \u2013 N123 billion, UBEC \u2013 N112 billion, Defence \u2013 N100 billion, Agriculture \u2013 N83 billion, Water Resources \u2013 N82 billion, Education \u2013 N48 billion, Health \u2013 N46 billion, North East Development Commission \u2013 N38 billion, SIPs \u2013 N30 billion, FCT \u2013 N28 billion and Niger Delta \u2013 N24 billion.
\nHowever, Senate President, Ahmed Lawan in his speech charged all government ministries, departments and agencies to defend their proposals before lawmakers before the end of October.
\nHe also said the lawmakers should ensure the budget got passed before the end of the year.
\nThe Peoples Democratic Party (PDP), in its reaction yesterday, said the N10.7trillion 2020 budget presented by President Muhammadu Buhari to the National Assembly would further impoverish Nigerians and mortgage the future of the nation and its citizens.
\nThis is even as the party urged the legislature to redirect the fiscal proposal to serve the interest of the vast majority of Nigerians.
\nA statement issued by the party\u2019s National Publicity Secretary, Kola Ologbondiyan, described the appropriation bill as \u201chazy, showing streaks of padding, fraudulent duplication, replete with false performance indices, deceptive projections and inexplicable expenditure assertions which create openings for continued looting of our national patrimony by leaders of the All Progressives Congress (APC) and persons close to the Presidency.\u201d
\nIt read in part: \u201cThe PDP insists that it is inexcusable that despite the huge natural resources at President Buhari\u2019s reach, he articulated an N10.7trillion budget that is completely lacking in concrete wealth creation strategy but relies on further squeezing of Nigerians through excruciating taxes, levies and agonizing tolls.
\n\u201cThe party described as unacceptable that the budget is skewed to serve the interest of the opulent, as projects that have a direct bearing on the wellbeing of the masses were not substantially accommodated in the overall expenditure profile.
\nThe party also criticized the Buhari-led administration for \u201cnot being transparent in the mammoth allocations for alleged vague projects, particularly the Ministries of Works and Housing as well as Transportation, where allegations of diversion of public funds were endemic in the last budget.
\n\u201cStanding with millions of Nigerian youths and women, our party rejects the paltry budgets of N48billion for Education and N46billion for Health, and urges the National Assembly to review the allocations in the interest of Nigerians.
\n\u201cFurthermore, the PDP notes, as unacceptable that President Buhari, in his budget speech, could not give an account of his handling of the 2019 budget and had to resort to lame excuses and unsupported figures, particularly on the various unimplemented subheads in critical sectors of the economy.
\n\u201cMoreover, Mr President failed to explain why his administration has remained hugely corrupt and how his Presidency depleted our foreign reserves to an all-time low of $41,852billion accumulated huge foreign and domestic debts and kept the naira at its knees at about N360 to $1 under his watch.\u201d
\nThe party also challenged the Presidency to make public the details of the Presidency allocation for Nigerians to \u201csee the billion being spent to finance the opulent lifestyle of the Buhari Presidency, despite Mr President\u2019s claims of prudence and sacrifice.\u201d
\nThe Peoples Democratic Party (PDP) also urged the National Assembly (NASS) to redirect the 2020 budget to areas that would better serve the interest of majority of Nigerians.
\nOlogbondiyan said that the budget as it is would further impoverish Nigerians and mortgage the future of the nation.
\nThese, according to him, would create openings for diversion of public funds.
\nAlso, the Coalition of United Political Parties (CUPP) has described the 2020 Budget presented to the National Assembly by President Muhammadu Buhari as heavy buy lacking substance.
\nThis came as it announced that it was heading for the court to challenge the planned increment in the Value Added Tax (VAT), by the Federal Government.
\nCUPP particularly said the budget was similar to a heavy travelling bag that has no substance in it.
\nIn a statement issued by its spokesman, Ikenga Ugochinye, yesterday, the opposition political group, said it regretted to announce to the nation that with the budget presented by the president,\u201d the days of the nation\u2019s suffering are not any way close to an end.\u201d
\nThe statement reads, \u201cThe Coalition of United Political Parties (CUPP), having listened critically to President Muhammadu Buhari\u2019s 2020 Appropriation Bill as presented to the joint session of the National Assembly on Tuesday, regrets to inform Nigerians that the days of the nation\u2019s suffering are not any way close to an end.
\n\u201cThe president has by today\u2019s budget presentation shown that he has no formula to save the nation\u2019s economy from the impending final ruins that his mismanagement has caused.
\n\u201cOpposition parties see this fiscal document as an empty document that is not worth the paper on which it was written. It is full of rhetoric; Buhari\u2019s appropriation bill can best be described as a heavy travel bag that is empty in substance or value.
\n\u201cThe CUPP notes that this document is a final weapon to consolidate Buhari\u2019s next level of economic ruins, poverty, looting and visionlessness. It is a come and chop document meant to further impoverish many and prosper the privileged few.
\n\u201dThe ppposition rejects the inclusion of the illegal proposed increment in VAT as part of the 2020 budget expected source of funding. This has shown that the budget is built in the sky with no serious source of funding except taxing the people to death.
\n\u201cThe opposition coalition has therefore resolved to head to court this week to stop the planned insensitive move to tax the suffering citizens of Nigeria to death with the proposed increment in VAT from 5% to over 7%.
\n\u201cThe president should not force the suffering citizens to bear the consequences of his leadership failures.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"
Some economic experts have expressed concern over the Federal Government\u2019s decision to base the estimated revenue from Value Added Tax (VAT) in 2020 on 7.5 per cent instead of five per cent. Dr Patricia Auta, an Economic Analyst, while reacting to the N10.33 trillion budget submitted to the National Assembly yesterday in Abuja said that […]<\/p>\n","protected":false},"author":1,"featured_media":216967,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[76,26],"tags":[688],"class_list":["post-216959","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-featured","category-front-pix","tag-front-pix"],"_links":{"self":[{"href":"https:\/\/www.thetidenewsonline.com\/index.php?rest_route=\/wp\/v2\/posts\/216959","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.thetidenewsonline.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.thetidenewsonline.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.thetidenewsonline.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.thetidenewsonline.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=216959"}],"version-history":[{"count":0,"href":"https:\/\/www.thetidenewsonline.com\/index.php?rest_route=\/wp\/v2\/posts\/216959\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.thetidenewsonline.com\/index.php?rest_route=\/wp\/v2\/media\/216967"}],"wp:attachment":[{"href":"https:\/\/www.thetidenewsonline.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=216959"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.thetidenewsonline.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=216959"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.thetidenewsonline.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=216959"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}