FG, States, LGs Share N2.34tn as Revenue Falls

The Federal Government, states and local government councils have shared N2.338tn from revenue generated in August 2026, representing a 22.2 per cent decline from the previous month.

The allocation was announced after the September meeting of the Federation Account Allocation Committee held in Abuja, with the funds distributed among the three tiers of government.

The amount shared in August was N669bn lower than the N3.007tn distributed in July, which was the highest monthly Federation Account allocation recorded in 2026.

According to the FAAC figures, the decline was largely driven by a sharp reduction in statutory revenue. Gross statutory revenue fell by N1.508tn, or 34.6 per cent, from N4.359tn in July to N2.850tn in August.

Despite the decline in statutory revenue, Value Added Tax collections increased during the period. Gross VAT revenue rose by N40.875bn to N834.843bn in August, compared with N793.968bn recorded in July.

A total gross revenue of N3.685tn was available for the month. After deductions for the cost of collection, transfers, refunds and savings, N2.338tn remained for distribution.

The Federal Government received N804.897bn, while the 36 states received N794.313bn. The 774 local government councils received N555.142bn.

Benefiting states also received N184.388bn as 13 per cent derivation revenue from mineral resources.

A breakdown of the distributable statutory revenue showed that the Federal Government received N727.573bn, states received N369.035bn and local governments received N284.511bn. An additional N184.388bn went to states under the derivation arrangement.

From the N773.233bn distributable VAT revenue, the Federal Government received N77.323bn, states received N425.278bn, while local governments received N270.632bn.

The latest allocation highlights the volatility of government revenue, particularly the influence of statutory income on the amount available for sharing among the three tiers.

FAAC said several revenue streams recorded mixed performances during August. Petroleum Profit Tax, Hydrocarbon Tax, VAT, Common External Tariff levies and excise duty increased during August.

However, Companies Income Tax, Capital Gains Tax, Stamp Duties Tax, petroleum royalties, mineral royalties, gas-flared penalties, import duty, rental gas-flared fees and miscellaneous oil revenue declined.

The lower allocation could affect the fiscal planning of federal, state and local governments, which rely significantly on FAAC distributions to finance public services, salaries, infrastructure and other obligations.