President Goodluck Jonathan on Wednesday presented a total budget proposal of 4.92 trillion Naira (about (US$ 31 billion) for the 2013 fiscal year, showing a modest increase of about 5% over the N4.7 trillion appropriated for 2012.
PANA reports that in his presentation to a joint session of the National Assembly, in Abuja, the Nigerian capital, the president said that under the budget proposal, recurrent expenditure was put at 2.41 trillion Naira while 1.54 trillion Naira will be spent on capital projects.
With this, aggregate expenditure is set to further reduce from 71.47% in 2012 to 68.7% in the 2013 Budget while capital expenditure as a share of aggregate spending is set to increase from 28.53% in 2012 to 31.3% next year.
The budget is based on oil production of 2.53 million barrels per day, up from 2.48 million barrels per day for 2012; and the benchmark oil price of US$ 75 per barrel, a modest increase from the US$ 72/barrel approved in the 2012 Budget.
President Jonathan said that the aggregate expenditure of 4.92 trillion Naira, proposed for the main budget of the 2013 fiscal year, is made up of 380.02 billion Naira for Statutory Transfers, 591.76 billion Naira for Debt Service, 2.41 trillion Naira for Recurrent (Non-Debt) Expenditure and 1.54 trillion Naira for Capital Expenditure.
The budget is also based on a fiscal deficit projection of about 2.17% of the GDP, compared to the 2.85% in 2012.
Some key allocations in the budget are as follows: Works – N183.5 billion; Power – N74.26 billion; Education – N426.53 billion; Health – N279.23 billion; Defence – N348.91 billion; Police – N319.65 billion; and Agriculture & Rural Development – N81.41 billion.
On the 2013 fiscal policy, Jonathan stated that in order to promote Nigerian agriculture and industry, his government would implement supportive fiscal measures for some priority areas especially on rice, cassava, wheat and machinery for the agriculture and power sectors.
Under the fiscal policies, machinery and spare parts imported for local sugar manufacturing industries will now attract 0% duty; there will also be a 5-year tax holiday for “sugarcane to sugar” value chain investors.
Furthermore, import duty and levy on raw sugar will be 10% and 50% respectively, while refined sugar will attract 20% duty and 60% levy.
For rice, a 10% import duty and 100% levy will be applied to both brown and polished rice.
“For aircraft, all commercial aircraft and aircraft spare parts imported for use in Nigeria will now attract 0% duty and 0% VAT,” the president said, adding “This will appreciably improve safety in our skies as newer fleet and less onerous maintenance will prevail.”
He said machinery and equipment imported for use in the solid minerals sector will now attract 0% import duty and 0% VAT.
President Jonathan added: “In order to encourage the production of mass transit vehicles in Nigeria, duty on Completely Knocked Down components (CKD) for mass transit buses of at least 40-seater capacity, will now be 0%, down from 5%.
“Government desires to support green growth and, in this regard, will explore options for providing incentives for energy efficient vehicles from the 2014 fiscal year,” he said.