The Federal Government has proposed a 3.13 percent revenue increase to the local government.
Secretary to the Government of the Federation (SGF), Boss Mustapha, disclosed this in Abuja on Tuesday at a town hall meeting, conveyed by Revenue Mobilisation, Allocation and Fiscal Commission (RMAFC), on the review of Nigeria’s vertical revenue allocation formula.
The SGF said the federal government will shade-off 2.03 percent of its allocation, while the states will cede 1.1 percent all in favour of the local governments.
“As an interim and immediate measure, the Federal Government is therefore proposing the following: Federal Government 50.65 percent; State Government 25.62 percent; Local Government 23.73percent and Derivation Allocation 13 percent”,” Mustapha said.
The present vertical Revenue Allocation Formula is: FG 52.68 percent; states 26.72 percent; and Local Governments 20.60 percent and Derivation Formula 13 percent.
The SGF said revenue allocation should be done constructively in the face of dwindling national revenue base and the imperative for states to generate their IGR.
“Equally important is the fact that this review should culminate in improved national development,” he said.
