The federal government intends to submit an emergency economic law to increase revenue from Nigeria’s non-oil industry.
This was revealed by Wale Edun, Minister of Finance and Coordinating Minister of the Economy, during his presentation at the Lagos Business School (LBS) Breakfast Club on Monday.
According to the minister, the federal government is “finalising an Emergency Economic Bill, which will, in part, enhance non-oil revenue.”
Specifically, the proposed legislation will “expand tax base, improve compliance, automate excise tax; review tax exemptions and duty waivers (1% of GDP); and recalibrate incentive structure e.g. post-ante.”
The Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, Taiwo Oyedele, recently said that his committee has drafted a new tax regulation, which will amend existing laws.
He said:
“We have drafted a new tax regulation. The only reason why it hasn’t been published is that some of the things we included will amend the existing laws, so we put the amendment in the emergency bill waiting for the lawmakers to pass, so we can then issue the regulation.”
Oyedele also noted that Nigeria can easily earn N10 trillion annually via efficient management of its non-oil assets.
He added that the country’s non-oil assets, estimated to be between N80 trillion and N100 trillion, are yet to get sufficient attention and are also being mismanaged.
The non-oil sector contributed around 95.30% to Nigeria’s GDP in the last three months of 2023, according to the Nigeria Bureau of Statistics 2023 fourth quarter GDP report. This percentage is below the 95.66% recorded in the fourth quarter of 2022, yet it surpasses the 94.52% noted in the third quarter of 2023. In the quarter under review, the non-oil sector experienced a growth of 3.07% in real terms.
This growth rate was 1.37% points lower than that observed in the same quarter of 2022, but it was 0.32% points higher than the growth seen in the third quarter of 2023.
The growth of the non-oil sector in the fourth quarter of 2023 was primarily fuelled by key industries such as financial and insurance (Financial Institutions); information and communication (telecommunication); agriculture (crop production); trade; construction; manufacturing (food, beverage, and tobacco); and real estate.
The federal government expects N19.41 trillion revenue from the Federal Inland Revenue Service (FIRS) in 2024. This target represents a significant increase of 56.91% from the previous year’s actual target.