N4.4trn capital expenditure for 2021, boost for infrastructure —BMO

The allocation of N4.37 trillion, representing over 30% of the 2021 budget, to capital expenditure, is a continuation of the Buhari administration’s plan to spend out of the COVID-19 induced recession.

According to the Buhari Media Organisation (BMO) in a statement signed by its Chairman Niyi Akinsiju and Secretary Cassidy Madueke, this is the first time in years that the Federal Government would be committing more than one-third of its spending plan on infrastructure development.

“We want Nigerians to note that the 32.2% the government has opted to use for capital expenditure is over 60% higher than what it set aside in the revised 2020 budget.

“ It is clearly a reflection of President Muhammadu Buhari’s bid to bridge years of infrastructure deficit in a country that deserves more than what his administration inherited.

“That this government refused to be deterred by the global economic situation, but chose to commit a record-breaking percentage of its total spending plan for 2021 to capital expenditure is commendable.

“This shows that the Buhari administration is really serious about its vow to spend out of the pandemic induced recession as well as its Economic Sustainability Plan (ESP) which is meant to put money in the hands of Nigerians through a N2.3trn stimulus package.

“And in case there may be scepticism about government’s readiness to spend that much on capital expenditure, we are convinced that the N1.8 trillion capital expenditure release in 2020, which amounted to a record 89% of the total allocation, should clear all doubts.”

BMO also hailed the Finance Act as a good platform for small businesses to grow in 2021.

“For the avoidance of doubt, workers within the N30,000 minimum wage bracket are exempted from personal income tax deductions; all micro and small companies earning N25m or less as annual turnover are exempted from paying the tertiary education tax. The Act also reduces the minimum tax payable by an operating company to 0.25% of turnover, from 0.5%.

“The implication of these, amongst others,  is a deliberate government policy to create enabling environment for SMEs to grow and develop, while the exemption of minimum wage earners from income tax alongside the exemption of more than 500 basic products from VAT is also a fiscal strategy to provide comfort for low wage earners.”

BMO assured Nigerians that the 2021 budget would pave way for a more resilient economy.