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Published On: Wed, Nov 15th, 2017

Senate approves Buhari’s fresh $5.5bn loan request

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Nigerian-Senate-1• Probes alleged N20trn stamp duties fraud

By Christiana Ekpa and Ikechukwu Okaforadi Abuja

The Senate has approved a $5.5billion loan request earlier sent to it by President Muhammadu Buhari to grant the Federal Government’s intent to secure two external borrowings.
This is just as the Upper Chamber has mandated its Committees on Finance and Banking, Insurance and other Financial Institutions to investigate alleged N20 trillion unremitted stamp duties revenue in the last five years, and report back within eight weeks.
Buhari had in a letter of request to the National Assembly dated October 4 , 2017, said the external borrowings had been captured in the 2017 Appropriation Act , which has a deficit of N2 .356tn and provision for new borrowings of N 2.321 trillion .
The requested loan, Buhari had said issuance of $2 .5 billion in International Capital Market through Eurobonds or a combination of Eurobonds and Diaspora bonds will be used for the financing of the Federal Government of Nigeria ’s 2017 Appropriation Act and capital expenditure projects in the Act.
While he further requested that issuance of Eurobond in the ICM and /or loans syndication by the banks in the sum of $ 3 billion will be for refinancing of maturing domestic debts obligations of the Federal Government.
However, yesterday in plenary, Senate completely gave it’s nod to the request and granted President Buhari to proceed on securing the external borrowings.
The approval by the Senate followed the adoption of a report by the Senate Committee on Local and Foreign Debts which was presented in plenary.
Presenting the report, Senator Shehu Sani (Kaduna Central) explained that the loan met the Senate’s approval because it is in line with the borrowing plan of the 2017 Appropriation Act.
According to Sani, the terms of the loan are favorable and do not pose any compromise of the integrity, independence and interest of the country and it citizens.
He further stated that the projects to be executed with the loan are essential for economic and social development, and that when completed, the project will create jobs.
In a remark, the Deputy President of rhe Senate, Ike Ekweremadu, who presided over yesterday’s session said that “this Senate will continue to partner with the Federal Government in matters that concern the ordinary people of Nigeria”
According to him, “The implementation of the 2017 budget is key because any appropriation act that is not implemented is worthless.
So, whatever needs to be done to be ensure that the budget is implemented, will always have the support of this Senate.”
“And since this is tied to the implementation of the 2017 budget, I believe that that had informed the support that this request is now generating.
We need to urge the Debt Management Office to ensure that our debt profile is monitored so that we will always ensure that it is within the acceptable limit”.
The Senate, however, assured that it will properly oversight all the projects that the loans are meant to support in the outgoing 2017 budget.
On the stamp duties revenue probe, the House also commended the tenacity and fortitude of the School of Banking Honours, SBH for bringing the issue of unremitted stamp duties revenue to public notice, and for insisting on probity of the Nigerian Inter Bank Settlement System, NIBSS.
The senate resolution followed a motion, sponsored by Senator John Owan Enoh (APC Cross River Central) and co-sponsored by 10 other senators. On “Urgent need to investigate allegations of Unremitted Stamp Duties Revenue running into trillions of naira”, Presenting the motion, Senator Enoh said the Upper House was “perturbed by recent reports in the media that over N7 trillion in stamp duties revenue from electronic cashless transactions remain unpaid to the federation since 2015, and that the total volume of unremitted stamp duties fund is about N20 trillion”.
He said it was also “worried that the provision for stamp duty in the revenue framework of the nation’s annual budget for 2015, 2016 and 2017 has been N8.713b, N66.138b and 16.96b respectively despite the above reports”.
Enoh added that the Central Bank of Nigeria, CBN had declared in 2013 that stamp duties revenue accruals from five states only was over N160 billion.
According to him, the senate was apprised of the anti-stamp duties collection stance of the NIBSS currently being accused of systemic diversion of huge revenue flows from stamp duties collection on the electronic transfer receipt on online bank transactions, and the necessity to demand notice on all unremitted stamp duties.
He submitted that it was “the duties and responsibilities of the National Assembly to ensure the harnessing of all sources of revenue to the government of the federation and to curb all forms of wastefulness, corruption and diversion of funds belonging to the federation”.
According to Senator Enoh, the Stamp Duty Act is one of the oldest and enduring laws in Nigeria since 1939, and that application of stamp duties has institutionally been a significant revenue earner for both federal and state governments since independence, thus accounting for almost a quarter of the taxation resources, annually.
Contributing, Senator Suleiman Hunkuyi (APC Kaduna North), faulted the revenue profile quoted in the motion, noting that it was not done in accordance with the laid down procedure of approvals.
He said: “The revenue profile under stamp duty for 2015-2017 were captured as N8.7billion; N66.1billion and N16.9 billion for the three years, but did not show probity it does not show that allocation of whatever is indicated under the stamp duty of each of those years.
“The same item of revenue in 2015 was N8.7 billion even though the collection has not been indicated. This is an indication that whosoever is providing these figures is not doing in consonant with any laid down procedure of the actual expectation from approvals on that item.
“There is no way N8 billion will be provided this year and then the next year, N66 billion is provided on the same sub head. What had been in those years is only but a fraction.
We should as a matter of necessity that stands to be one of the responsibilities of the National Assembly”.
In his remarks, Deputy President of the Senate Mr Ike Ekweremadu said the motion was a very straightforward one .
“The one of the resolutions was that, there be a public hearing, we need to limit our contributions so that we don’t prejudice the public hearing.”
The motion was thereafter unanimously adopted by the lawmakers.

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