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RMAFC presents new revenue sharing proposal to Buhari

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  • FG to get 45%, states 29.7%, LGs 21.04

President Muhammadu Buhari has received a report on the review of the vertical revenue allocation formula from the Revenue Mobilisation, Allocation and Fiscal Commission (RMAFC).
The report proposes a sharing formula of 45.17 per cent for the FG, 29.79 per cent for state governments and 21.04 per cent for the local governments.
Under the current sharing arrangement, the federal government takes 52.68 percent of the revenue shared, states get 26.72 percent while local governments get 20.60 per cent.
The development is coming on the heels of the review of the current revenue sharing formula by RMAFC, which commenced in June, last year.
According to a statement by Femi Adesina, presidential spokesperson on Thursday, Buhari said he will await the final outcome of the constitutional review process before presenting the report to the national assembly.
‘‘Ordinarily, I would have gone ahead to table this report before the National Assembly as a Bill for enactment,” Buhari said.
‘‘However, since the review of the vertical revenue allocation formula is a function of the roles and responsibilities of the different tiers of government, I will await the final outcome of the constitutional review process, especially as some of the proposed amendments would have a bearing on the recommendations contained herein.”
Buhari outlined some of the recommendations in the report as the “establishing local government as a tier of government and the associated abrogation of the state/local government account; moving airports; fingerprints, identification and criminal records from the exclusive legislative list to the concurrent legislative list, empowering the RMAFC to enforce compliance with remittance of accruals into and disbursement of revenue from the Federation Account as well as streamlining the procedure for reviewing the revenue allocation formula.’’
The President assured members of the commission that the FG would immediately subject the report to its internal review and approval processes, while awaiting finalisation of the efforts by the national assembly.
The President said, this strategy, rather than issuing an Executive Modification Order, as was done in 1992, was more in line with entrenching the democratic tenets.
“I am aware that the present revenue allocation formula has not been reviewed since the last exercise carried out in 1992,” he said.
‘‘Considering the changing dynamics of our political-economy, such as Privatisation, Deregulation, funding arrangement of Primary Education, Primary Health Care and the growing clamour for decentralisation among others; it is necessary that we take another look at our Revenue Sharing Formula, especially the vertical aspects that relate to the tiers of government.
‘‘This becomes more compelling as we need to reduce our infrastructural deficit, make more resources available for tackling insecurity, confront climate change and its associated global warming and make life more meaningful for our rapid growing population.’’
According to him, equitable distribution has always been observed in the sharing of national resources.
“‘I want to let you all know that I have keenly followed most of the discussions held in the geo-political consultative process and one thing that struck me clearly was the agreement that a review of our vertical revenue formula cannot and should not be an emotional or sentimental discussion and it cannot be done arbitrarily,” Buhari said.
‘‘All over the world, revenue and resource allocation have always been a function of the level of responsibilities attached to the different components or tiers of government.
‘‘I am, therefore, happy to note that the discussions were held along these lines and rested squarely on roles and responsibilities as spelt out in the 1999 Constitution (as amended).
‘‘However, I also note that in reaching the final decisions at most of these engagements, not much emphasis was placed on the fact that the Second Schedule of the Nigerian constitution contains Sixty Eight (68) items on the Exclusive Legislative List and the remaining Thirty (30) items on the Concurrent List requiring both the Federal and State Government to address.”
Buhari said for the nation to have a lasting review of the present revenue allocation formula, there must first be an agreement in the responsibilities of all the tiers of hovernment.
He noted that the proposal seeks a 3.33 percent reduction in the current federal government allocation and on the other hand an increase of 3.07 percent and 4.4 percent for the states and local governments.
He added that with regard to special funds, the report by the RMAFC proposed an increase of two percent for the Federal Capital Territory (FCT) and a decrease of 38 per cent for development of natural resources.
The President said the FG also made its input into the process of reviewing the vertical revenue allocation formula.
He said this was based on existing constitutional provisions for roles and responsibilities for the different tiers of government.
“We must note the increasing visibility in sub-national level responsibilities due to weaknesses at that level. For example: Primary Health Care; Basic Primary Education; Levels of insecurity, and; Increased remittances to state and local governments through the Value Added Tax sharing formula, where the Federal Government has only 15 per cent and the states and local governments share 50% and 35% respectively,’’ he added.
The chairman of RMAFC, Elias Mbam, said the proposed vertical revenue allocation formula advised 45.17 percent for the FG, 29.79 percent for state governments and 21.04 per cent for the local governments.
Under special funds, he said, the report by the commission recommended 1.0 percent for ecology, 0.5 percent for stabilisation, 1.3 percent for development of natural resources and 1.2 percent for the FCT.
Mbam said there was wide consultation with major stakeholders, public hearing in all the geo-political zones, administering of questionnaires and studying of some other federations with similar fiscal arrangements like Nigeria to draw useful lessons from their experiences.
According to the RMAFC chairman, the commission also visited all the 36 states and the FCT, the 774 local government areas to sensitize and obtain inputs from stakeholders.
He said literature reviews were conducted on revenue allocation formula in Nigeria dating back to the pre-independence period.
He added the commission received memoranda from the public sectors, individuals and private institutions across the country.
Mbam said since the last review was conducted in 1992, the political structure of the country had changed with the creation of six additional states in 1996, which brought the number of states to 36.
He said the number of local governments also increased from 589 to 774.

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Happening now: Hyundai unveiling of Mufasa and Grand Creta

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Happening now: Hyundai unveiling of Mufasa and Grand Creta (photos)

Two latest models of Hyundai auto brands are currently being officially rolled out in Lagos. The new vehicles are Mufasa and Grand Creta.

The unveiling is taking place at the Hyundai showroom on Akin Adesola Street Victoria Island, Lagos.

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No 5% Petrol Tax Plan, Oyedele Says, Amid Public Concerns

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No 5% Petrol Tax Plan, Oyedele Says, Amid Public Concerns

 

The Federal Government has no plan to introduce a new tax on petrol, Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, has said, dismissing reports that the administration of President Bola Tinubu intends to impose a five per cent levy on petroleum products.

Oyedele clarified the issue in a statement posted on his X account on Tuesday, insisting that a fuel tax was not being considered by the government.

“In my interview with ARISE News, I was clear: a fuel tax is not on the table,” he said.

His statement follows reports linking him to the proposed five per cent tax, which sparked concerns about a possible increase in the cost of petrol amid Nigeria’s persistent cost-of-living crisis.

Petrol prices have remained a major driver of transportation and distribution costs since the removal of the fuel subsidy, contributing to higher prices of food and other essential goods and services.

The prospect of an additional levy had raised fears that households and businesses could face further financial pressure.

However, Oyedele’s clarification indicates that the Federal Government is not currently considering the proposed fuel tax, amid broader efforts to reform Nigeria’s tax system and strengthen public finances.

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Beyond the Showroom: Why After-Sales Service Will Define Auto Industry Winners

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Beyond the Showroom: Why After-Sales Service Will Define Auto Industry Winners

Nigeria’s automotive industry must look beyond vehicle prices, specifications and flashy new models if it hopes to win lasting customer confidence. The real test of competition increasingly lies in what happens after the sale — when a vehicle needs servicing, spare parts, repairs or warranty support.

A car purchase is not a one-off transaction. It marks the beginning of an ownership journey that could last several years, during which the quality of after-sales service can determine whether a customer remains loyal to a brand or regrets the decision to buy it.

When customers struggle to obtain genuine parts, secure timely repairs or get clear answers to warranty claims, their frustration can damage confidence not only in a dealer but also in the manufacturer and the wider automotive market.

After-sales service must therefore move from the background to the centre of automotive competition in Nigeria.

 

Promises must translate into performance

Effective customer care starts with clear, credible commitments. Buyers deserve to understand warranty coverage, servicing schedules, access to genuine parts, repair procedures and the support available when problems arise.

But promises alone are not enough. A warranty has limited value if customers cannot access a competent service centre. A roadside assistance number means little without an effective response system. And a repair-time guarantee is only as good as the technicians, parts and processes supporting it.

Automotive distributors and dealers must ensure that their marketing promises are matched by the operational capacity to deliver.

Buyers, on their part, should ask questions before committing their money, examine warranty conditions and establish what support they can realistically expect throughout the vehicle’s lifespan.

 

Competing on ownership experience

Nigeria’s automotive market would benefit enormously if brands competed not only on the vehicles they sell but also on the quality of ownership experience they provide.

Such competition could drive improvements in service delivery, warranty transparency, spare-parts availability, technical training, repair turnaround and customer communication.

Some players are already putting more structured after-sales propositions before buyers. Carloha’s CarlohaCare 6-6-7 programme, for instance, combines a six-year warranty, six years of free servicing and a seven-day repair promise, subject to applicable terms and conditions. Its CarlohaCare Rescue service extends the proposition to assistance beyond the workshop.

These offerings illustrate how clearly defined service commitments can become part of a vehicle’s value proposition, rather than an afterthought.

However, the objective should not be to crown a permanent winner or single out one company as the industry benchmark. Every provider must demonstrate that its commitments are practical, transparent and consistently delivered.

The wider industry should embrace continuous improvement, with customers ultimately judging brands by their real-world experiences.

 

Automotive journalism must ask tougher questions

Automotive journalism has a critical role in broadening the conversation.

Coverage of the sector often focuses on vehicle launches, new technologies, prices, specifications and expansion plans. These remain important, but consumers also need independent reporting on the realities of vehicle ownership.

Journalists can examine warranty conditions, investigate spare-parts availability, interview service managers and fleet operators, document consumer experiences and assess how effectively companies resolve complaints.

They should celebrate genuine improvements while holding businesses accountable when their public commitments fall short.

The Nigerian Automotive Journalists Association (NAJA) is well positioned to encourage this conversation through informed reporting, industry analysis, interviews and stakeholder engagement.

The goal should be to bring manufacturers, distributors, dealers, fleet operators and consumers around a fundamental question: What level of care should Nigerians reasonably expect after buying a vehicle?

That conversation must remain independent, balanced and evidence-led, rather than becoming a promotional platform for individual brands.

 

Make after-sales service a buying criterion

The shift towards stronger customer care will gather momentum when Nigerians begin to assess after-sales support as seriously as they consider engine performance, fuel economy, safety features and purchase price.

A private buyer should ask about warranty coverage, servicing costs and the location of authorised workshops. A fleet operator should evaluate parts availability, repair turnaround and vehicle downtime alongside acquisition costs. Families should know what assistance is available when a vehicle breaks down far from home.

Dealers that offer transparent terms and dependable support should earn a competitive advantage. Those that fall short should have a clear incentive to improve.

This is particularly important in a market where vehicle ownership involves significant financial commitment and prolonged exposure to maintenance costs. A seemingly attractive purchase can become expensive if parts are difficult to source or repairs take too long.

The industry must therefore recognise that customer care is not merely a cost centre. Properly managed, it can build loyalty, strengthen brand reputation, generate repeat business and encourage referrals.

 

The real test begins after payment

Nigeria does not need an automotive market in which businesses compete only to sell more vehicles. It needs one in which they also compete to keep customers satisfied long after the keys have been handed over.

The true measure of a brand is not simply how attractively it markets a vehicle or how efficiently it closes a sale. It is how responsibly it responds when the customer needs help most.

As competition intensifies, the companies that combine good products with reliable service, accessible parts and transparent customer support will have a stronger foundation for lasting success.

For buyers, the message is equally clear: look beyond the showroom, ask the difficult questions and compare the support behind the badge.

Buy the car. Demand the care.

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