Finance Act, PIA: Accountant General Moves To Stop Revenue Leakages

The Office of the Accountant-General of the Federation (OAGF), has taken measures to stop revenue leakages and boost the country’s revenue collection through the Finance Act, 2021 and the Petroleum Industry Act.

It would be recalled that the 9th National Assembly passed the bills which were also signed into law by President Muhammadu Buhari.

But the director of the Federation Account Department, Office of the Accountant-General of the Federation, Mr Muhammad Saleh, said their office will used the two laws to block revenue leakages and also improve revenue generation.

Speaking at a three-day training by the African Leadership Development Initiative (ALDI), organised by the Department for its staff, with the theme: “Evaluation of salient issues emanating from PIA and Finance Act as it affect Federation Account revenue and disbursement,” Saleh said Nigerians will get the maximum benefit of the laws when it comes to revenue generation.

While declaring the event open, Mr Saleh, expressed optimism that a firm knowledge of the content and of the two Acts would equip the staff of the Department to know what to look for in the nation’s drive for more revenue generation and distribution.

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“I must say that the content of this program is a very rich content and is something that everybody should be availed the opportunity to learn one or two things. With the content of this program, you all know our responsibility; we have a responsibility of collecting all information regarding the revenue being generated by the revenue generating agencies, with especially the NNPC.

“The NNPC has turned to be another thing today. It is a commercial venture which is supposed to remit its proceeds to the Federation for sharing but not as usually. There are basic items which it supposed to bring to the table for sharing. But until you know, then you will get it but if you don’t know, you will not find the revenue that is needed to be distributed. At the end of the day we distribute nothing,” Saleh said.

Corroborating Saleh’s position, the deputy director of the Federation Account Department, Mrs Rita Okolie, hinted that since the Finance Act came into effect, the revenue collection of the Federation has received appreciable boost, noting that the new law also increased the Value Added Tax (VAT) from five per cent to 7.5 per cent.

She said: “The training is about looking at the new policies that have been passed into law; that is the Finance Act and the Petroleum Industry Act (PIA). We are looking at these laws because it will affect our functions, our responsibilities in the office; and we consider this necessary to see how these laws can positively affect and enhance our operations, especially in the area of revenue generation, so that we know what we should be expecting from the revenue generating agencies.

“Since the laws came into effect, we have seen a lot of positive impacts. For instance, revenue from the Value Added Tax of this country has tremendously improved. You know that before the Finance Act came into effect, VAT was five per cent but now VAT is 7.5 per cent. And if you look at the revenue from the time of this policy, you will see that the difference is much higher. Likewise our stamp duty; before 2019, government generated less than N8 billion but when you look at what we have generated in 2020 and 2021, the difference is so huge.”

Also speaking, the National Coordinator and Chairman, Board of Trustees, African Leadership Development Initiative (ALDI), Mr Uzo Eberendu, explained that the Initiative is a non-governmental organisation involved in midwifing and explaining a lot of critical issues in the society, including training, capacity building and networking.

Explaining the reason for the training, he said: “The purpose of this training is largely to drive home the purpose of the new legislations concerning revenue generation and revenue administration, particularly as it affects the three tiers of government in Nigeria namely: the Federal, the State and the Local governments.

“The Federation Account Office is the department that plays the critical role of organising the distribution of the revenues as accrues to the Federation, and shares it among the three tiers of government according to the laid down standard formula.

“So, this training is largely meant to bring into effect the knowledge of very recent legislations by the National Assembly, concerning the Petroleum Industry Act and the Finance Act in relation to revenue generation of the country and then its distribution. So, that is why we brought about the training of people who know the effect of these new laws and how it can apply in handling the funds.

Eberendu lamented that most of the revenues generated in the country were not accounted just as he lamented that there was lack of will power to use the instrumentality of the law to generate and manage the needed revenues for the nation’s unhindered development.

“There are problems in the nation’s revenue generation process. Most of the revenues generated on behalf of government are not accounted for through so many leakages. And many others are not even integrated or harnessed. Then another thing is the political will to use the instrumentality of the law to generate and manage the needed revenue in the country.

“I think this is the most critical of all the factors militating against our revenue generation and administration. In the revenue generation process, there is so much interference from the powers that be and lack of strength of will to implement established laws in revenue collection,” he stated.

The African Leadership Development Initiative, invited seven resource persons to train the participants in different aspects of their job demands including including Dr. Kennedy Iwundu, Dauda Ojoye, Prof. Uwakwe Abugu, Ernest Joel, who all spoke on the provisions and implementation of Finance and Petroleum Industry Acts.