FAAC: FG, States, LGs Shared N2.55 Trillion in June as VAT Revenue Rises 7.5%

The Federation Account Allocation Committee says a total of N2.55 trillion was shared among the federal government, states, and local government councils in June, with VAT revenue increasing by 7.5% to N799.74 billion.​

The N2.55 trillion comprised N1.8 trillion in statutory revenue and N740.72 billion in VAT revenue. The federal government received N923.43 billion, states got N838.2 billion, local governments received N591.39 billion, while oil-producing states received N197.61 billion as derivation revenue.

Gross statutory revenue rose to N3.7 trillion in June from N2.65 trillion in May. Collections from CIT, CGT, stamp duties, petroleum royalties and import duties increased significantly, while PPT, HT and mineral royalties declined.

Key Points:

States and LGs have more funds available for infrastructure and service delivery.
Increased VAT revenue signals higher consumer spending despite inflationary pressures.
Oil-producing states benefit from increased derivation revenue allocation.
The revenue boost may support economic activity across all tiers of government.
Timing of the allocation, mid-year, supports budget implementation at all levels.

How states and LGs utilise the increased allocations and whether the revenue growth trend continues.

Sources: Nairmetrics, Business Post