In a bid to drive economic growth and sustain development initiatives, the Lagos State Government is ambitiously targeting an Internally Generated Revenue (IGR) of N1.251 trillion to finance its 2024 budget. Governor Babajide Sanwo-Olu unveiled this fiscal strategy during the presentation of the 2024 budget, aptly titled the “Budget of Renewal.”
The financial blueprint outlines a comprehensive approach, projecting a combination of the targeted IGR and a total Federal transfer of N596.629 billion to support the N2.246 trillion budget. Notably, this target reflects a substantial 17.35% increase from the N1.066 trillion set in the 2023 budget.
Governor Sanwo-Olu articulated the budget breakdown during a presentation at the Lagos State House of Assembly on December 13. Of the total budget, N1.224 trillion, constituting 54%, is allocated for capital expenditure, while N1.021 trillion, representing 46%, is earmarked for recurrent expenditure.
Lagos State has maintained its position as Nigeria’s highest generator of internally generated revenue for over two decades. In the first half of 2023 alone, the state reported an impressive N400 billion in revenue. In 2022, the National Bureau of Statistics disclosed that Lagos generated N651.15 billion, with Rivers State coming in a distant second at N172.82 billion in IGR.
The surge in the projected IGR is likely linked to an enhanced tax drive, aligning with the goals of both the state and federal governments to boost tax collection in the upcoming fiscal year. The 2024 Lagos State budget also reveals a noteworthy 117.56% growth in the targeted total Federal transfer compared to the 2023 budget.
Given that Value Added Tax (VAT) constitutes a significant portion of the anticipated Federal transfer, the state anticipates a heightened VAT collection drive in the coming year. The Lagos State Internal Revenue Service (LIRS) has taken proactive steps in recent weeks, introducing various solutions across sectors to enhance tax collection throughout the state. Notably, the Eco Fiscal System, an automated invoicing solution for revenue collection, has been implemented to streamline the process.
Looking ahead to 2024, it is expected that the LIRS will intensify efforts to collect the 5% consumption tax imposed on consumables and personal services in Lagos State. This move aligns with the broader strategy of diversifying revenue sources and ensuring sustainable funding for critical development projects.
As Lagos State continues to lead the nation in revenue generation, the emphasis on fiscal responsibility and innovative tax collection mechanisms underscores the government’s commitment to fostering economic growth and meeting the evolving needs of its residents. Infostride News remains dedicated to keeping our readers informed on the latest developments in Lagos State’s economic landscape.
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