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Solid Minerals Revenue Hits N43.2Bn In 2016 – NEITI

The Nigeria Extractive Industries Transparency Initiative (NEITI), on Tuesday reported that the  solid minerals sector of the economy generated N43.22 billion into the Federation Account in 2016.

The transparency agency, in its 2016 audit report of the solid minerals sector, hinted that taxes collected by the Federal Inland Revenue Service (FIRS) accounted for N40.38 billion or 93.43 percent of the sector’s revenue, while fees collected by the Mining Cadastral Office stood at N1.15 billion or 2.66 per cent.

In addition, the report indicated that the Mining Inspectorate Department (MID) raked in N1.64 billion as royalty payments, representing an increase of 30.15 percent over the N1.27 billion reported as royalty payments in the preceding year.

According to the report, the audit conducted under the EITI principles and standard reconciled payments made by mining companies in terms of taxes, royalty and rents against receipts of such payments by relevant government agencies.

It reflected further that  total minerals production for 2016 was 41.87 million tons valued at N34.09 billion, representing 33 per cent increase on the N25.56 billion reported in the preceding year.

NEITI stated that tax collection and payment of other fees for 2016 however reduced by 32 percent when compared to the N63.98 billion accruals in 2015.

The agency reported that while 651 extractive companies made royalty payments in 2016, only 56  met the materiality threshold of N3 million and above were considered for reconciliation, adding that the companies that met this threshold accounted for 86.87% of the total royalties paid.

When analysed on state-by-state minerals production basis, the report showed that Ogun State contributed 33.49 percent to the total production to top the table, followed by Kogi State with a contribution of 19.7 percent, while FCT came third with 6.20 percent.

On the revenue sharing ratio, the report indicated that the sum of N9.923 billion was shared by the three tiers of government in 2016, being the accumulated revenues from 2007 to 2014 from the solid minerals sector.

A breakdown of the funds shared showed that the  Federal Government got N4.547 billion while states and local governments shared N2.306 billion and N1.778 billion respectively. The sum of N1.289 billion was also shared as derivation.

As expected, Ogun State received the highest share of  N369.84 million while Kogi and Cross River states received N317.66 million and N237.10 million respectively. Kano and Oyo states received N208.83 million and 200.45 million respectively while Ekiti and Bayelsa got the lowest share of N91.25 million and N76.66 respectively.

The release of the 2016 report by NEITI brought to seven in the series of independent reports on the solid minerals sector published as part of the agency’s efforts to ensure transparency as well as bring local and international attention to the revenues and investment potentials in the solid minerals sector.

 

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