Senate

Senate Approves 2025–2027 Fiscal Framework, Launches Probe into N8.48tr NNPCL Subsidy Allegations

Published

12 hours ago

December 4, 2024

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Senate Plenary

The Senate has approved the 2025–2027 Medium-Term Expenditure Framework (MTEF) and Fiscal Strategy Paper (FSP) while mandating a comprehensive investigation into allegations that the Nigerian National Petroleum Corporation Limited (NNPCL) withheld ₦8.48 trillion in petrol subsidies and $2 billion (₦3.6 trillion) in unpaid taxes.

The approval followed the presentation of a report by Senator Sani Musa (Niger East), Chairman of the Joint Committees on Finance and National Planning & Economic Affairs. The fiscal document sets key projections, including an exchange rate of ₦1,400 to the dollar for 2025 and a GDP growth rate of 4.6%.

The Senate also tasked its Committees on Finance and Petroleum as well as Gas to investigate allegations that the Nigerian National Petroleum Corporation Limited (NNPCL), withheld about N8.48 trillion in petrol subsidies, and $2 billion (NGN 3.6 trillion) in unpaid taxes (dividends).

The allegation was highlighted by reports from the Nigeria Extractive Industries Transparency Initiative (NEITI) and the Revenue Mobilization, Allocation, and Fiscal Responsibility Commission.

This was just as the Office of the Auditor-General of the Federation, said it had received the necessary and complete documents required to verify the N2.7 trillion fuel subsidy claim by the Nigerian National Petroleum Company Limited against the government.
The Chairman, Senate Committee on Public Accounts, Senator Aliyu Wadada, corroborated the claims of the AuGF on the floor of the red chamber yesterday when he said the NNPCL team had been consistently shunning his panel’s summons over the matter.
The Senate, approved the exchange rate projection of 1,400 to a dollar for the 2025-2027 with a provision for review in early 2025, based on prevailing monetary and fiscal policies.
The upper chamber also resolved that any excess on the official figure would be used for debt servicing.
In its resolutions, the Senate also adopted inflation rate projections of 15.75, 14.21 and 10.04 per cent for 2025, 2026 and 2017 respectively.
Part of the resolutions read, “The 2025 Federal Government of Nigeria budget proposed spending of N47.9trilion of which N34.82 trillion is retained. New borrowings stood at N9.22tn, made up of both domestic and foreign borrowings.
“Capital expenditure is projected at N16.48 trillion naira with statutory transfers standing at 4.26 trillion naira and sinking funds projected at N430.27billion.
“Debt service was valued at N15.38 trillion; pensions, gratuities
and retirees’ benefits stood at N1.443 trillion and fiscal deficit at NGN13.08 trillion.
“That the Capital expenditure is projected at N16.48 trillion which is exclusive of transfers. Statutory transfers stand at N4.26 trillion, while Sinking Fund is projected at N430.27 billion.
“The Committee approves the respective figures for total recurrent (non-debt) at N14.21 trillion; special intervention for recurrent and capital is at NGN200 billion and N7 billion.
“That the National Assembly do approves the Promissory Note Programme and Bond Issuance to settle outstanding claims and liabilities of Federal Government owed to States, high priority judgments as well as liabilities incurred by federal ministries, department and agencies on behalf
of Government.
“That the Committee recommends that a quarterly investigative hearing with revenue generating agencies to track their compliance with the Fiscal Responsibility Act and punish those in clear contravention of the Act.
“That the Committee on Finance review and initiate inquiry into the implementation of the Nigerian Export Supervision Scheme (NESS) Act, specifically focusing on the inspection and monitoring of
oil and gas exports by the Ministry of Finance and the Central Bank of Nigeria (CBN).
“This is to ensure effectiveness, compliance, and oversight mechanisms under the Act, identify gaps or challenges,
and enhance revenue for the Government, through transparency, accountability and efficiency of export supervision in line with national economic objectives.
“That the Committees on Finance and Customs to initiate an investigative inquiry into the operations of the Import Duty Exemption Certificate (IDEC) programme, with a focus on the administration of
import waivers and their impact on revenue losses by the Ministry of Finance and the Nigeria Customs Service.
“The committee will evaluate compliance, identify systemic gaps or irregularities, and
recommend measures to enhance transparency, accountability and optimize revenue generation for
the nation.
“That the Committee recommends that a performance metrics be established for MDAs with poor financial reporting standards and mandate regular independent audits of their accounts to ensure compliance.
“That the projected oil benchmark prices are $75, $76.2 and $75.3 per barrel be approved for 2025, 2026 and 2027 respectively.
“That the three-year projections for domestic crude oil production had a significant increase from
1.78 mbpd in the preceding year to 2.06, 2.10 and 2.35 for the subsequent years of 2025, 2026 and 2027 be approved.
“That the National Assembly, through its Committees on Finance, National Planning and other relevant Committees should carry out in-depth investigation of such agreements by the NNPC, NLNG and Immigration Services with a view to reconcile remittances to the Federation Account.
“That the Committees on Finance, Petroleum Upstream, Downstream, and Gas are tasked to investigate reports from the Revenue Mobilization, Allocation, and Fiscal Responsibility
Commission alleging that the NNPC withheld ₦8.48 trillion as claimed subsidies for petrol.
“Additionally, the investigation will address the NEITI report stating that NNPC failed to remit $2billion (₦3.6 trillion) in taxes to the Federal Government.

“The committees are further directed to
verify the total cumulative amount of unremitted revenue (under-recovery) from the sale of Premium Motor Spirit (PMS) by the NNPC between 2020 and 2023.
“That the GDP growth rate which is projected at 4.6%, 4.4% and 5.5% for years 2025, 2026 and 2027 respectively, be approved.
“That the projected exchange rate which stands at NGN1400/USD for years 2025, 2026 and 2027 be approved subject however to review in early 2025 according to monetary and fiscal policies
“That the Inflation rates projections which are 15.75%, 14.21% and 10.04% for 2025, 2026 and 2027, be approved;
“That the Federal Government of Nigeria Budget proposed spending stands at N47.9 trillion, of which N34.82 trillion was retained.
“New borrowings stood at NGN9.22 trillion which constitutes both domestic and foreign borrowings; debt service was valued at N15.38 trillion.
“Pensions, gratuities and retirees’ benefits stood at N1.443 trillion and fiscal deficit at N13.08 trillion.
“That the Capital expenditure is projected at NGN16.48 trillion which is exclusive of transfers statutory transfers stand at NGN4.26 trillion while Sinking Fund is projected at N430.27 billion.
“That the Committee approves the respective figures for total recurrent (non-debt) at N14.21
trillion; special intervention for recurrent and capital is at N200 billion and N7 billion.
“That the National Assembly do approve the Promissory Note Programme and Bond Issuance to settle outstanding claims and liabilities of Federal Government owed to States, high priority judgments as well as liabilities incurred by Federal Ministries, Department and Agencies on behalf
of Government.
“That the Committee recommends that a quarterly investigative hearing with revenue generating agencies to track their compliance with the Fiscal Responsibility Act and punish those in clear
contravention of the Act,” among others.
During the debate on the report, the lawmakers also demanded a reduction in the petrol prices against the backdrop of the commencement of the Port Harcourt Refinery.
Chairman of the Senate Committee on Appropriations, Senator Solomon Adeola, noted that the Federal Government’s Compressed Natural Gas initiative was part of the underlying imperative for the adoption of the N1, 400 to one dollar.
He said, “With the functioning of our refineries the demand for Forex will drop.

“With the CNG initiative, Nigerians will have an option when they want to embark on a journey.

“If you leave Benin for Lagos, the amount of fuel is about 130 thousand but with CNG you can’t use more than 48 thousand Naira. Another issue to be addressed is the recurrent to-capital ratio which is very high.
Senator Yahaya Abdullahi, (PDP, Kebbi North), stressed the need to support the manufacturing industries if the projections of the MTEF are to be achieved.

Senate

Senate suspends Action on Controversial Tax Reform Bills

Published

7 hours ago

December 4, 2024

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***Constitutes Special Committee to Engage FG

The Senate has suspended further action on the contentious Tax Reform Bills, as a result of widespread public outcry and opposition from Northern Governors, who labeled the bills as “anti-democratic.”
The decision was announced by Deputy Senate President Jibrin Barau during Wednesday’s plenary.
Barau explained that the Senate Committee on Finance had been directed to halt public hearings and deliberations on the bills until the concerns raised by various stakeholders are addressed.
A special committee has also been constituted to liaise with the executive branch to resolve the contentious issues.
The Contentious Bills Under Review are: ‘A Bill for an Act to Establish the Joint Revenue Board, the Tax Appeal Tribunal and the Office of the Tax Ombudsman, for the harmonisation, coordination and settlement of disputes arising from revenue administration in Nigeria and for other related matters, 2024.
‘A Bill for an Act to Repeal the Federal Inland Revenue Service (Establishment) Act, No. 13, 2007 and enact the Nigeria Revenue Service (Establishment) Act to Establish the Nigeria Revenue Service, charged with powers of assessment, collection of, and accounting for revenue accruable to the Government of the Federation, and for related Matters, 2024.
‘A Bill for an Act to Provide for the assessment, collection of, and accounting for revenue accruing to the Federation, Federal, States and Local Government; prescribe the powers and funtions of tax authorities, and for related matters, 2024.
‘A Bill for an Act to Repeal certain Acts on taxation and consolidate the l;egal frameworks relating to taxation and enact the Nigeria Tax Act to provide for taxation of income, transactions and instruments, and for related matters.
The bills aim to reform the nation’s tax system, but have faced opposition, particularly due to concerns about the proposed value-added tax (VAT) derivation formula, which critics argue could disproportionately affect northern states.
Northern Governors had strongly opposed the bills, with Borno State Governor warning that they could “crumble the economy of the North.” In response, the National Economic Council (NEC), chaired by Vice President Kashim Shettima, recommended the withdrawal of the bills for further consultations.
Oyo State Governor Seyi Makinde, speaking on behalf of the NEC, had emphasized the need for broader consensus, noting that certain sections of the country found aspects of the bills unacceptable.
Following the controversy, the Senate invited the President’s Economic Team, led by Taiwo Oyedele, Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, and Zacchaeus Adedeji, Chairman of the Federal Inland Revenue Service, to clarify the bills. Despite their explanations, concerns persisted, prompting the Senate to call for further dialogue.
Deputy Senate President Barau emphasized the Senate’s role as a stabilizing force, stating, “We have decided to set aside politics, ethnicity, and regionalism to resolve the issues surrounding the tax reform bills. In collaboration with the Executive, we will establish a forum to identify and address contentious areas to ensure national unity.”
Barau added that the Attorney General of the Federation would be involved in the discussions to resolve legal disputes surrounding the bills.
The special committee, comprising Senate leadership and key members such as Adamu Aliero, Orji Kalu, Seriake Dickson, and Sani Musa, is scheduled to meet with the Attorney General on Thursday to address the issues.
The Senate reaffirmed its commitment to supporting President Bola Tinubu’s economic reforms while ensuring that no new policies exacerbate the country’s current economic challenges.

Senate

Senate Alleges FIRS, NNPCL Withheld Petroleum Profit Tax for Years

Published

16 hours ago

December 4, 2024

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Aliyu Wadada

Chairman of the Senate Public Accounts Committee (SPAC), Senator Aliyu Wadada, has accused the Federal Inland Revenue Service (FIRS) and Nigerian National Petroleum Company Limited (NNPCL) of withholding petroleum profit tax meant for the federation account for several years.

During a debate on the Medium-Term Expenditure Framework (MTEF) and Fiscal Strategy Paper (FSP) for the 2025 Appropriation Bill, Wadada disclosed that repeated invitations to both agencies went unanswered or yielded unsatisfactory responses.

“The FIRS, in collaboration with NNPCL, has not remitted petroleum profit tax for a number of years,” he said.
“We requested clarifications, but the documents provided were tampered with, including tipex corrections and handwritten notes, allegedly from JP Morgan. This is unacceptable.”

Wadada emphasized the need for greater accountability from revenue-generating agencies, warning that their failure to meet remittance obligations could undermine the nation’s fiscal stability. He called for urgent action to address the issue, noting that efforts to resolve it have so far been unsuccessful.

The allegations raised concerns about the effectiveness of Nigeria’s revenue collection processes as the government prepares its 2025 budget.

Senate

‘Heavens Won’t Fall’: Senator Dickson Vows Tax Reform Bill Will Pass Despite Opposition

Published

2 days ago

December 2, 2024

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The Senator representing Bayelsa West senatorial district Seriake Dickson has confidently declared that the Tax Reform Bill will be passed, likening it to the passage of the Petroleum Industry Bill (PIB), which succeeded with a controversial 3% allocation to host communities instead of 10%.
He dismissed fears of backlash, assuring Nigerians that the legislative process will not be derailed by opposition.
“When the PIB passed at 3% instead of 10%, heavens didn’t fall, and they won’t fall now,” Dickson asserted. “This Tax Reform Bill is vital for correcting an unfair system, and it will be passed through due process.”

Central to the bill, Dickson explained, is the need to ensure taxes are paid to the states where they are generated.
“It’s unacceptable that taxes from Bayelsa are sent to Lagos simply because of company headquarters.
If you make calls, buy cement, or consume any service in Bayelsa, the tax should stay in Bayelsa—not Lagos,” he stressed.

As a former governor of Bayelsa, Dickson highlighted his long-standing fight against this inequity, recalling his efforts to challenge VAT distribution in the Supreme Court.
He urged states concerned about potential losses to present their case during the upcoming public hearings.
“Public hearings are for facts, not emotions. Let everyone come forward with their data, there will be no intimidation,” he said.

Dickson also addressed concerns of a northern opposition bloc, emphasizing that his stance is rooted in national interest, not regional politics.
“I don’t play regional games. I’m a national politician, and I do what’s best for Nigeria,” he declared.
He pointed to his record of standing on principle, noting his opposition to the Naira redesign policy and his push for fairer revenue allocation in the PIB.
“I don’t follow the crowd. When others supported the Naira redesign, I stood against it because it wasn’t right. I’m consistent in fighting for what’s fair,” he remarked.

Dickson concluded by stressing the urgency of the tax reform, stating that it is essential for ensuring fairness in Nigeria’s revenue-sharing system.
“This bill is about justice. States should benefit from the wealth they generate. It’s time to end a system that benefits a few at the expense of others,” he said.

With public hearings on the horizon, Senator Dickson’s message is clear: the Tax Reform Bill will pass, bringing long-overdue fairness to Nigeria’s tax system—whether or not opposition remains.