Across various states in Nigeria, billions of naira are being spent on luxury vehicles and the renovation of government facilities, much to the detriment of essential services and infrastructure development, Saharareporters reports.
An analysis of budget performance documents from several state governments reveals a worrying trend: personal tax earnings, a major source of revenue for state governments, are being used on frivolous expenditures such as new cars for government officials and extensive renovations, rather than addressing the pressing needs of their citizens.
Sokoto State’s Spending
Sokoto State, for example, budgeted to earn approximately N9.5 billion from personal taxes in 2024. This tax revenue is crucial for the state as it represents a key portion of its independent revenue. However, rather than focusing these funds on much-needed development, the state has earmarked an equivalent amount for extravagant expenditures.
In 2024, the Sokoto State government plans to spend N8.69 billion on purchasing Prado Jeeps for its executive council members and an additional N3.1 billion on vehicles for honorable members and management staff.
This brings the total to N11.7 billion, which exceeds the state’s projected tax earnings. As a result, Sokoto State will need to divert funds from other sources, such as its expected withholding tax revenue (estimated at N2 billion for the fiscal year), just to meet these vehicle expenses.
Adamawa State’s Financial Decisions
In Adamawa State, a similar pattern is unfolding. The state anticipates earning N3 billion from various tax sources, including Pay As You Earn (PAYE) taxes from state and local government workers, as well as companies.
However, despite the relatively modest tax revenue, the state has chosen to allocate N2.2 billion—72.2% of its projected tax earnings—on construction and renovations related to the Deputy Governor’s office.
This includes N1 billion for the construction of the Deputy Governor’s lodge in Abuja and N1.2 billion for the renovation of the Deputy Governor’s offices in Yola.
Imo State’s Extravagant Spending
Imo State’s budget for personal taxes in 2024 stands at a significant N19 billion. Yet, even here, the focus is on high-end expenditures. The state has budgeted N3 billion for purchasing vehicles for the 27 members of the Imo State House of Assembly, along with an additional N120 million for furnishing the Clerk’s house.
In simpler terms, for every N100 earned in taxes, the state plans to spend N16.3 on vehicles and furnishing. This prioritization raises serious concerns about the state’s fiscal management, especially when considering that many areas of the state still struggle with basic services.
Kwara State’s Budget Allocation
In Kwara State, the government expects to collect N13.4 billion from personal taxes in 2024. The budget breaks down into N11.5 billion from PAYE and N1.9 billion from direct assessment taxes.
However, the state plans to spend N1.8 billion on vehicles and the renovation of the presidential lodge. This includes N300 million for the purchase of vehicles for 24 new House of Assembly members, the Clerk of the House, and other officials.
Additionally, N1 billion is allocated for the presidential lodge and guest chalets. For every N100 Kwara State collects in taxes, N13.6 is allocated toward vehicles and other non-essential items.
Cross River State’s Resource Mismanagement
In Cross River State, tax earnings from personal taxes and direct assessment taxes totaled N3 billion in the first half of 2024. However, during the same period, the state government spent N1.6 billion on renovations.
This includes N500 million for the governor’s lodge and N1.1 billion for renovating government offices. These expenses consumed 53% of the state’s tax earnings for that period, diverting funds away from more critical developmental projects.
Ekiti State’s Misaligned Priorities
Ekiti State also followed the trend of lavish spending. In the first six months of 2024, the state earned N5 billion from personal taxes. However, it spent N1.451 billion on 40 GAC SUVs for political office holders and an additional N314 million on furniture, bringing the total expenditure to N1.7 billion.
This means that for every N100 the state earned in taxes, N34 was spent on luxury vehicles and furniture purchases, rather than addressing the state’s more urgent needs.
These expenditures come at a time when Nigerian states are facing a host of developmental challenges. Poor road networks, inadequate healthcare facilities, and a lack of clean water are just a few of the issues plaguing states.
These are the kinds of problems that tax revenues are supposed to help address, but instead, much of the money is being funneled toward luxury purchases and unnecessary renovations.
Many states are also heavily indebted, relying on loans to meet their fiscal needs. Despite these financial strains, spending billions on cars for political office holders and renovating government buildings continues.
