President Bola Tinubu is set to present the 2024 Appropriation Bill of N27.5tn to a joint session of the National Assembly on Wednesday. The Federal Executive Council (FEC) approved the budget, marking an increase from the initially considered N26.01tn. The Minister of Budget and Economic Planning, Abubakar Bagudu, disclosed that the Federal Government is projecting N18tn in revenue for the 2024 fiscal year.
The FEC also approved changes to the Medium Term Expenditure Framework (MTEF) benchmarks, including an exchange rate of N750 to $1 and a benchmark crude oil reference price of $77.96, a $4 increase. These adjustments aim to increase government revenue to support priority areas such as health, education, infrastructure, security, and other developmental projects.
Additionally, the FEC approved a $1bn budget support loan from the African Development Bank (AfDB) to improve forex availability and support ongoing economic reforms. The loan has an interest rate of 4.2% for 25 years with an eight-year moratorium.
The Minister of Finance and Coordinating Minister of the Economy, Wale Edun, highlighted the tax initiatives of the Federal Government, including the removal of VAT on diesel. The Fiscal Policy and Tax Reform Committee’s report received by the Council aims to increase tax revenue and efficiency through digitalization and rationalization of taxes.
The Council also approved a total limit of N2tn for the Ministry of Finance to access the market for refinancing, aiming to bring down interest rates on existing debt and save about N50bn or more in debt servicing.
The President’s budget presentation comes after the Senate’s approval of the Medium Term Expenditure Framework, with parameters such as a benchmark oil price of $73.96 and oil production volume per day at 1.78 million barrels.
