ABF NEWS | Abuja, Nigeria
The Federal Government, state governments and Local Government Councils have shared a total of ₦2.428 trillion as revenue allocation for September 2026, out of a gross revenue of ₦3.913 trillion, following the October meeting of the Federation Account Allocation Committee (FAAC).
The meeting was chaired by the Accountant-General of the Federation, Shamsudeen B. Ogunjimi, and considered revenue accruing to the Federation Account from statutory sources and Value Added Tax (VAT).
Of the total distributable revenue of ₦2.428 trillion, the Federal Government received ₦832.242 billion, while the 36 states of the federation shared ₦799.872 billion. Local Government Councils received ₦560.660 billion, while oil-producing states were allocated ₦236.049 billion as the 13 per cent derivation revenue from mineral resources.
The committee also reported ₦131.758 billion as the cost of revenue collection, while ₦1.353 trillion was allocated to transfers, refunds and savings.
The FAAC communiqué indicated that gross revenue available from Value Added Tax for September 2026 stood at ₦816.872 billion, compared with ₦834.843 billion distributed in the preceding month, representing a decline of approximately ₦17.972 billion.
From the September VAT revenue, ₦23.576 billion was allocated for the cost of collection, while ₦36.709 billion went to transfers, refunds and savings. The remaining ₦756.587 billion was distributed among the three tiers of government.
Under the VAT-sharing arrangement, the Federal Government received ₦75.659 billion, state governments received ₦416.123 billion, and Local Government Councils received ₦264.805 billion.
The decline in VAT receipts underscores the importance of sustained efforts to strengthen tax compliance, improve revenue administration and broaden the tax base to support government expenditure across the federation.
In contrast to the decline in VAT revenue, gross statutory revenue for September 2026 rose to ₦3.097 trillion from ₦2.850 trillion recorded in the preceding month, representing an increase of approximately ₦246.384 billion.
Of the statutory revenue, ₦106.182 billion was allocated for the cost of collection, while ₦1.316 trillion was set aside for transfers, refunds and savings.
The remaining distributable statutory revenue of approximately ₦1.672 trillion was shared among the beneficiaries. The Federal Government received ₦756.583 billion, state governments received ₦383.749 billion, and Local Government Councils received ₦295.855 billion. Oil-producing states received ₦236.049 billion as 13 per cent mineral revenue derivation.
The communiqué further disclosed mixed performance across the various revenue streams. Petroleum Profit Tax (PPT), Hydrocarbon Tax (HT), petroleum royalties, import duty, CET levies and excise duty recorded significant increases during the period.
However, Companies Income Tax (CIT), Stamp Duties Tax (SDT), Value Added Tax, mineral royalties, gas-flaring penalties, rental, gas-flaring fees and miscellaneous oil revenue recorded decreases.
The contrasting performance of these revenue sources highlights the need for improved revenue forecasting, effective tax administration and prudent fiscal planning by the three tiers of government.
The September allocation provides additional fiscal resources for the Federal Government, state governments and Local Government Councils to finance public services, infrastructure development and other budgeted obligations.
However, the size of monthly allocations alone does not determine the quality of fiscal outcomes. The impact of the funds will depend largely on budget credibility, expenditure discipline, transparency, accountability and the prioritisation of development projects.
For subnational governments in particular, effective management of statutory allocations and internally generated revenue remains critical to meeting recurrent obligations while sustaining investment in education, healthcare, infrastructure and other essential services.
According to the communiqué, the total distributable statutory revenue for September stood at approximately ₦1.672 trillion, while distributable VAT revenue amounted to ₦756.587 billion, bringing the total distributable revenue to ₦2.428 trillion.
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