The Lagos State Commissioner for Finance, Dr. Rabiu Olowo, has reeled out fiscal sustainability measures that have been adopted by the state to cushion the impact of the Covid-19 on its economy.
He said although due to the impact of the pandemic, the state was expected to record drop in its internally generated revenue, drop in federal allocation as well as a decline in Foreign Direct Investment (FDI), the state government had in swift response re-ordered its full year 2020 Budget and re-prioritised its capital expenditure to reflect current realities.
Olowo, made this disclosure while giving the scorecard of his ministry at a ministerial press briefing commemorating one year in office of the State Governor, Mr. Babajide Sanwo-Olu at Ikeja, recently.
The Commissioner also revealed that: “Lagos State achieved 106 per cent performance in first quarter of year 2020 revenue as against budget.
“However, with COVID–19 and the dwindling oil price is a twin-shock to Nigeria, we expect that the revenue numbers will be affected, hence the need to review the full year 2020 budget assumptions.”
Apart from the re-ordering of the 2020 budget, the Finance Commissioner listed other strategies already adopted by the government to manage the impact of the pandemic to include principal and interest moratorium for MSMEs with loans from the Lagos State Employment Trust Fund (LSETF); extension of tax filing; management and control of dedicated funds for COVID-19 response, including timely payment of hazard allowance and arrangement of special peril insurance for frontline health workers and volunteers.
In the area of revenue optimisation, the Commissioner revealed a number of initiatives put in place in the last one year by this administration to include F.O.R.C.E (Focus On Revenue Creation Everywhere), an initiative conceived to monitor, review and drive innovative revenue performance whilst providing revenue assurance.
Also, he listed the deployment of E-Tax platform for tax operations and administration matters, aimed to improve convenience in the payment of taxes thereby promoting compliance.
The automation of the operations of Lagos State Lottery Board were amongst improvement that would guarantee sustainable revenue optimisation to allow for the state to finance infrastructural projects that would improve the lives of Lagosians, create jobs, stimulate the economy through government spending.
Speaking on the government’s reform in the area of Land Use Charge (LUC), Olowo said the reform was necessary to accommodate the agitations of Lagosians and to reduce the financial pressure on citizens.
“As we are aware in 2018, there was an increase in LUC rate and at the same time a revaluation of properties; this twin-shock had a sporadic increase in LUC assessment. The soon-to-be revealed reform will among other things, reverse the rate to pre-2018 rate,” he said.
He explained that the intention of the state government was to keep economic activities of the state going, without necessarily causing any untold hardship that will further aggravate the present financial hardship confronting all sectors of the State’s economy.