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Seven Northern states, one oil-producing state declared bankrupt in Nigeria

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 Seven Northern states, one oil-producing state declared bankrupt in Nigeria Seven Northern states and one Southern state have been declared…

 Seven Northern states, one oil-producing state declared bankrupt in Nigeria

Seven Northern states and one Southern state have been declared bankrupt based mostly on their internally generated income compared with their Federal Accounts Allocation (FAA).

Jigawa, Katsina, Adamawa, Yobe, Niger, Taraba and Benue had been tagged bancrupt states alongside oil-producing Bayelsa State by the Annual State Viability Index (ASVI) of Financial Confidential.

The standing of the states had been decided by share arrived at when their IGR and FAA was in contrast, and states with IGR of lower than 10 p.c of their federal allocation are categorised bancrupt.

The standing of the states had been decided by share arrived at when their IGR and FAA was in contrast, and states with IGR of lower than 10 p.c of their federal allocation are categorised bancrupt.

Bankrupt states in Nigeris by 2020

Bayelsa topped the listing of the poorest states in Nigeria because it obtained a complete of N152.54 billion as FAA in 2020, however generated solely N12.18 billion as IGR – this represents 8.0 p.c of earnings from FAA.

Jigawa State got here subsequent with IGR of N8.6 billion in distinction to the N107 billion it obtained as allocation throughout the identical interval – this represented 8.1 p.c of complete incomes.

Katsina recorded 8.8 p.c after producing N11.3 billion in opposition to the N130 billion federal allocation.

Adamawa obtained N91 billion of FAA, however may solely generate N8.3 billion IGR, placing the variations at 9.1 p.c.

Yobe state recorded N7.7 billion IGR, however received N84 billion federal allocation – this represented 9.2 p.c in complete receipt.

Niger State was subsequent with 9.6 p.c as its internally generated income was put at N10.5 billion in comparison with N109 billion of FAA.

Taraba generated N8.1 billion as IGR, however was given N82 billion from federal allocation, placing its distinction in earnings at 9.8 p.c.

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Benue accomplished the listing with IGR of N10.46 billion, far under the N106 billion it obtained as FAA, representing 9.8 p.c final yr.

Finest performing states in Nigeria

 

Lagos state topped the listing of greatest performing states in Nigeria as its IGR, N418 billion, surpassed its N299 billion federal allocation, placing its earnings distinction at 139 p.c in 2020.

Rivers State got here subsequent with N117 billion to comparability to the N198 billion secured from the FAA – this represents 58 p.c distinction.

Ogun State completed final yr with N50 billion as internally generated income, falling under the N88 billion FAA it obtained, however its income distinction stood at 57 p.c.

Kaduna State is fourth on the listing, acquiring N124 billion federal allocation, whereas producing N50 billion IGR, representing 40 p.c distinction.

Oyo made the listing with 29.7 p.c distinction having generated N38 billion in IGR, however obtained federal allocation to the tune of N127 billion.

Anambra State’s internally generated income was put at N28 billion, nevertheless it received N94 billion as federal allocation, representing 29.6 p.c in earnings.

Extra drawback for the seven bancrupt states

The seven states are believed can’t survive with out federal allocation, which is about to drop following a Rivers State court docket ruling that the Federal Authorities just isn’t authorised by the structure to demand and gather non-import worth added taxes.

Justice Stephen Pam, who presided over the ruling acknowledged that the Concurrent Legislative Listing of the structure empowered solely states and its agent(s) to gather non-import vat inside their area.

This may cut back the tax income shared by FG to states by N1.64 trillion if the ruling stands, and it’ll cut back the full allocation of low-income producing states like Bayelsa, Katsina, Adamawa, Yobe, Niger, Taraba, Benue, Kano and others.

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