What is revenue allocation formula. Revenue Allocation Formula in Nigeria 2019-01-29

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Revenue Allocation Formula

what is revenue allocation formula

Agriculture, for instance, was a major source of revenue for the Western Region. This development led to the birth of the Niger Delta Development Commission, whose task is to see to the development of Niger Delta, where Nigeria got his oil from. While the Commission may have submitted its advice in form of a proposal, no one really knows who is responsible for drafting the bill that is generating anxiety presently. This has led to several revenue sharing formulas over the years and there are constant calls for adjustment of the current formula. With an equitable share of Sh335 billion, every Kenyan without health insurance is assigned an equivalent of Sh1,035, every outpatient visit Sh123 and the inpatient days equivalent is Sh540. How can I forecast revenue. Notable reports were received from Raisman Commission 1958, Aboyade Technical Committee 1977, Okigbo Panel1979 and National Revenue Mobilisation Allocation and Fiscal Commission 1992.

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WHAT IS REVENUE ALLOCATION IN NIGERIA?

what is revenue allocation formula

The Government decides to split these revenues and give to the lower level of governments. This has led to the demise of the other productive sectors of the economy. All this has however changed since the discovery of oil in the country. It is worrisome that the state governments, except Lagos could hardly depend on their Internally Generated Revenue as they heavily rely on the monthly allocation from the federation account for survival. You need to allocate the costs of manufacturing overhead to any items that are classified as work-in-process or finished goods.

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Revenue Allocation Formula

what is revenue allocation formula

That is, the amounts of money people spend relative to what is produced. This is because the Federal Government receives revenues from the taxes of all states! The content on the InfoGuide Nigeria is provided as general information only. From the available record, that formula indeed, encouraged the states to look inward and produce something, since the provision of the formula was that any state that produces something will control its resources and pay certain percentage to the federal government. Segment C can be computed by subtracting Segment B from Segment A. To explore this issue I wish to analyze the effect of globalization on one of the richest countries in resources in Africa — Nigeria. © Provided by The Star Counties will no longer be allocated a share of the revenue collected nationally based on the population quotas.

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What is Sales Revenue?

what is revenue allocation formula

At least 80% of the export for Nigeria comes from the oil production. In seconds the result is there. The Government gives the money to the states that have problems in reaching national standards in education, health, etc. But for very mysterious reason there was an allegation of circulation of fake bills in the National Assembly. I use this to get the number of days between the dates, then use a formula which gives me the Daily Cost, which I just copy right under each date.

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Understanding the Revenue Allocation Formula

what is revenue allocation formula

He pointed out that it is a crazy idea the attempts to make distinction between Federation from Federal Government. Even as the commission is proposing an increase in the funds to county governments, the National Taxpayers Association is calling on the National Treasury to stop funds transfer to counties found to have embezzled money. I was looking to prorate a flat monthly fee evenly — so even though Feb has 28 days it still gets the same revenue as Mar. Read: Bill to hasten funds rollout for counties This means each county lost on an average between Sh100 and Sh200 million for the financial year ending June 2019. It also needs to work when the current period is greater than the end date. One is to allow your worksheet to toggle between the calculated allocation amounts forecast and the actuals keyed in for past months. The Political forces keep fighting over the concepts of revenue allocation and fiscal federalism.


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Revenue Allocation Formula

what is revenue allocation formula

Any idea what is causing the issue? In conclusion, it could be said that the proposed new revenue formula will ensure that the current resources are distributed fairly, equitably and justly to all beneficiaries, while it would enhance national growth, development and cohesion. At least 45 per cent of the equitable share was distributed based on population in the first and second formulas. Political and economic instability Political and economic instability is one of the problems acredited to unfair derivative principle in Nigeria, as states were at loggerhead with the federal government, and the financial weakness experienced by most states. According to the 2009 population census, Nairobi has the highest population at 3. But regrettably, the local Government councils could not make representations because appointees of State Governors have replaced most of their elected officers at the grassroots. I should end this piece with a word on the argument that resources could also be wasted at the state level.

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revenue allocation formula

what is revenue allocation formula

For instance, how would I evenly distribute the costs to Feb, May, Aug, Nov? Counties that will pump more resources into development projects will have their revenue increased in subsequent years. Our formula also needs to handle the case where the monthly column header is less than the start date. Revenue allocation will always be considered as unfair. Even as the commission is proposing an increase in the funds to county governments, the National Taxpayers Association is calling on the National Treasury to stop funds transfer to counties found to have embezzled money. Revenue allocation refers to the practice whereby one level of government turns over a portion of the revenue it generates from taxation and other sources to another government level which is usually a lower level of government.

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Revenue allocation team revises formula for county finances

what is revenue allocation formula

The cost for providing consulting services to institutional customers is 15. Revenue sharing makes for a better relationship between the federal, state and local governments. In other words the government programs were commensurate with revenue source. Every Kenyan has also been awarded Sh1,562 for all other services. Nigeria practices a federation type of government. The related formulas in Excel are also quite simple, except for the part that figures out the number of days represented by each monthly column.

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Nigeria to review revenue allocation formula

what is revenue allocation formula

The allocation formula usually comes from the capital of the country. That proposed revenue formula remained with National Assembly for almost eight months before the Supreme Court Verdict of April 2002 on Resources Control nullified the Special Fund in the existing formula, which invariably affected the fate of the pending formula with legislators. Problems of Revenue Allocation in Nigeria 1. In May, production of the titanium shaft requires 5,400 hours of machine time, while the aluminum shaft needs 2,600 hours. This is an easy fix. The committee was mandated to work on the Bill and return it to the parliament Wednesday, listed for consideration on Thursday and eventually passed.

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