The Federal Government, the 36 states and the 774 local government areas shared N3.007tn in federation revenue for July 2026, following a significant increase in statutory revenue.
The allocation was approved at the August meeting of the Federation Account Allocation Committee, held in Owerri, Imo State.
According to a statement issued on Tuesday by the Director of Press and Public Relations at the Office of the Accountant-General of the Federation, Bawa Mokwa, gross statutory revenue increased to N4.359tn in July from N3.700tn recorded in June.
The N658.087bn increase represents a 17.8 per cent rise, attributed largely to improved collections from petroleum-related revenues and non-oil taxes.
The statement said, “FAAC approved the disbursement of a total of N3.007tn to the Federal Government, the 36 State Governments and the 774 Local Government Councils as revenue for July 2026.”
It added that the increase reflected stronger collection across oil and non-oil statutory revenue sources.
However, revenue from Value Added Tax recorded a slight decline, falling from N799.746bn in June to N793.968bn in July.
The committee said several revenue streams, including Petroleum Profit Tax, Hydrocarbon Tax, Companies Income Tax, Capital Gains Tax, Stamp Duty, petroleum royalties and mineral royalties, recorded increases during the month.
These gains were partly reduced by lower receipts from VAT, import duty, Common External Tariff levies, gas-flaring fees and some miscellaneous oil revenue.
Mokwa said the committee would continue working with revenue-generating agencies to strengthen collections and improve remittances.
“The Committee will continue to monitor as it works with revenue-generating agencies to close collection gaps and improve remittance discipline,” he said.
The meeting also focused on how governments could turn the recent increase in federation revenue into sustainable economic growth rather than rely solely on higher monthly allocations.
Officials were urged to strengthen internally generated revenue, improve the management of public assets, attract private investment, expand economic activities and increase investment in human capital.
States were also encouraged to maintain accurate asset registers, verify payroll records and publish audited financial statements promptly.
The committee noted that the rise in federation revenue over the past three years had been influenced by major fiscal measures, including petrol subsidy removal, foreign exchange reforms and tax reforms.
It also discussed changes introduced by the Nigeria Tax Act 2025, which took effect in January 2026 and increased the states’ share of VAT revenue from 50 per cent to 55 per cent.
Under the new arrangement, 30 per cent of the states’ VAT pool is distributed based on the location where consumption occurs rather than the registered headquarters of businesses.
The committee said the approach could encourage states to attract businesses and expand economic activity within their jurisdictions.
It further reaffirmed the importance of timely remittance of government revenues by Ministries, Departments and Agencies into the Federation Account.
The FAAC stressed that maintaining the revenue gains recorded in July would require stronger collection and remittance practices across government agencies.
It said the priority should now be to convert increased allocations into productive investments that would strengthen public finances, improve infrastructure and enhance living conditions.
“The Committee noted that sustaining the statutory revenue gains recorded in July 2026 will depend on continued discipline in collection and remittance across Ministries, Departments and Agencies,” the statement said.
