Nigeria:
Nigeria's 2016 Budget
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HIGHLIGHTS
(NGN' Bn) |
2016 |
2015 |
%
Change |
Total
Revenue |
3,855.8 |
3,452.4 |
11.7 |
Oil Revenue |
813.1 |
1,637.9 |
-50.4 |
Non-Oil Revenue |
1,536.8 |
1,214.7 |
26.5 |
Independent Revenue
& others |
1,581.2 |
599.8 |
163.6 |
Aggregate
Expenditure |
6,060.7 |
4,493.4 |
34.9 |
Recurrent Non-Debt |
2,646.4 |
2,593.21 |
2.05 |
Special Intervention
Program |
300 |
- |
100 |
Capital Expenditure |
1,587.6 |
557.0 |
185.0 |
Capex % of total
expenditure** |
31% |
12% |
|
Debt Service |
1,475.3 |
953.6 |
54.7 |
Budget Deficit |
-2,204.9 |
-1.041.0 |
111.8 |
Macro-Economic
Outlook Projections (MTEF) |
2016 |
2015 |
%
Change |
Real GDP Growth rate
(%) |
4.4 |
3.4 |
-20.5 |
Nominal GDP
(N'Trillion) |
103 |
94 |
9.4 |
Average Exch rate
(NGN/$) |
197 |
190 |
-3.7 |
Inflation rate (%) |
9.81 |
10.2 |
3.8 |
Growth of non-oil export
(%) |
16.5 |
16.5 |
0 |
Crude oil production
(mbpd) |
2.2 |
2.3 |
-3.4 |
Oil price benchmark
($/barrel) |
38 |
53 |
-28 |
Budget Deficit (% of
GDP) |
-2.14 |
-1.09 |
0.96 |
MTEF is Medium Term Expenditure Framework
- Actual inflation year on year as at
April 2016 was 13.7%
- Real GDP growth rate for Q1 2016 was
-0.36%
2016 REVENUE GENERATION SPLIT (MTEF)
Highlights of Revenue and Expenditure
- **Total capital expenditure is circa
NGN 1.8 trillion which includes NGN156 billion under Statutory
Transfers and NGN 86 billion in Debt Service.
- Oil revenue is expected to decline by
50% while non-oil revenue is projected to increase by 26.5%.
- Increase in non-oil tax revenue will
come mainly from Company Income Tax and Value Added Tax expected to
increase by 33.2% and 14.9% respectively.
- Spending is planned to increase in
2016 (compared to 2015) by about 35% to an aggregate expenditure of
N6.06 trillion.
- Non-debt recurrent expenditure for
2016 which represents about 43.7% of the aggregate expenditure is
expected to rise by 2% to NGN2.646 trillion. This includes NGN300
billion special intervention fund.
- Capital expenditure is proposed to
increase by about 180% to NGN1.58 trillion which constitutes about
30% of total expenditure.
- The ministry of works, power and
housing was allocated NGN423 billion or 26.6% of the capital
expenditure being the top recipient of capital spending.
- The federal government has earmarked
NGN2 billion for the National Job Creation/Graduate Internship
scheme.
Debt service
- The debt service cost is expected to
increase by 54.7% (to a record NGN1.475 trillion) accounting for
about 24.3% of total expenditure or 38% of revenue notwithstanding
a low debt to GDP ratio of circa 13%.
- NGN1.3 trillion and NGN54.5 billion
are required to service foreign and domestic debt
respectively.
- A sinking fund of 113.4 billion is
for the purpose of retiring matured loans.
Capital Expenditure of KeyMinistries (NGN'Bn)
Ministry |
2016 |
2015 |
%
Growth |
Agriculture |
46.2 |
8.8 |
425.0 |
Defence |
130.9 |
36.7 |
257.0 |
Education |
35.4 |
23.5 |
51.0 |
Healthcare |
28.7 |
22.7 |
26.0 |
Solid Minerals |
7.3 |
1 |
630.0 |
Transportation |
188.7 |
14.1 |
1238.0 |
Works, Power and
Housing |
423.0 |
26.6 |
1490.0 |
Tax Proposals in 2016 Budget Speech
- There was no proposal to change tax
rates or impose new taxes in 2016.
- The budget speech was silent on the
proposals to introduce a National Security Tax and the proposed
increase in Tertiary Education Tax.
- Government is however focused on
measures to increase the tax base and overall compliance rate in
the country.
- Luxury tax is expected to generate
NGN15billion but no disclosure of measures to implement.
- It was mentioned that the tax rate
for smaller businesses will be reduced.
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