Economic experts have warned that the Federal Government would face the hurdle of generating about N689 billion per quarter to, at least meet its 2020 revenue target. This was even as they urged the government to do more from a policy perspective to improve business operating environment, as well as consumer conditions, post the COVID-19 pandemic.
The National Bureau of Statistics (NBS) had said a total of N651.80 billion was generated as Value Added Tax (VAT) from N601 billion in the first half of 2019, signifying an increase of 8.5 per cent over 2019 figures. Furthermore, on a quarterly breakdown, VAT receipts in Q2, 2020 grew marginally by 0.81 per cent quarter-on-quarter (q/q) to N327.10 billion as against N324.60 billion recorded in the same period of 2019, a fallout of the implementation of VAT hike in February 2020, amid the disruption of economic activities in the period by the COVID-19 pandemic. But commenting on the development, Cordros Capital, in an emailed note to Daily Sun said, “On our estimate the government will face the hurdles generating N689 billion per quarter to, at least, meet its 2020 target. The foregoing is a tall order in our view, given the low level of activities from the onset of the COVID-19 outbreak, together with the COVID relief packages for small businesses which includes VAT exemptions.
Overall, the aggregate FG revenue for 2021 is projected at N7.50 billion, while aggregate expenditure is estimated to be N12.66 trillion (2020 revised budget estimate: N10.81 trillion), leading to a fiscal deficit of N5.16 trillion.
