FG, STATES, LGs SHARE RECORD N3TRN FROM JULY FAAC ALLOCATION
The Federal Government, state governments and local councils have shared about N3 trillion from the Federation Account for July 2026, marking the highest monthly allocation recorded under President Bola Tinubu’s administration.
The latest figure was announced following the August meeting of the Federation Account Allocation Committee, FAAC, held in Owerri, Imo State, under the chairmanship of the Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele.
The July allocation represents a significant increase from the N2.551 trillion distributed to the three tiers of government in June, reflecting a month-on-month rise of about N456 billion, or 17.9 per cent.
Under the latest distribution, the Federal Government received N1.146 trillion, while the 36 state governments shared N943.352 billion. Local government councils received N673.649 billion.
An additional N243.478 billion in 13 per cent derivation revenue from mineral resources was distributed to eligible states.
REVENUE INCREASE DRIVES HIGHER ALLOCATION
FAAC attributed the surge largely to improved collections from both oil and non-oil revenue sources.
Gross statutory revenue increased to N4.359 trillion in July, compared with N3.700 trillion recorded in June. The increase of N658.087 billion represents a monthly growth of 17.8 per cent.
According to the committee, stronger receipts were recorded from Petroleum Profit Tax, Hydrocarbon Tax, Companies Income Tax, Capital Gains Tax, Stamp Duty and petroleum royalties.
FAAC said the improvement was partly linked to better compliance and more efficient revenue collection.
However, some revenue streams recorded declines during the period.
VAT COLLECTIONS DIP SLIGHTLY
Gross Value Added Tax collections fell marginally from N799.746 billion in June to N793.968 billion in July, representing a decline of N5.778 billion, or 0.7 per cent.
Other revenue sources, including import duties, Common External Tariff levies, gas-flaring rental fees and miscellaneous oil revenue, also recorded decreases.
The committee said it would continue working with relevant revenue-generating agencies to address weaknesses and improve collections.
FAAC PUSHES REVENUE REFORMS
FAAC stressed the need to sustain the recent revenue gains through stronger collection, compliance and transparent remittance of all collectible funds into the Federation Account.
The committee also reaffirmed efforts to reduce dependence on oil revenue by strengthening tax administration and expanding non-oil revenue sources.
It called for greater coordination between the Federal Government and state governments through relevant fiscal and economic policy platforms.
STATES, LGs GET MORE FISCAL SPACE
The record July allocation could provide additional financial room for states and local governments to meet obligations such as salaries, infrastructure, healthcare, education and other public services.
However, the increased distribution also underscores the need for governments to develop more sustainable internally generated revenue sources instead of depending heavily on monthly FAAC allocations.
FAAC said it would continue pursuing reforms aimed at making revenue collection and the distribution of federally collected funds more transparent, predictable and sustainable across Nigeria’s three tiers of government.
