VAT Outpaced Statutory Allocations to States by ₦700bn in 10 Months

VAT allocations to Nigeria’s states exceeded statutory allocations by about ₦700 billion across 10 FAAC sharing months between September 2025 and July 2026. States received ₦3.80 trillion from VAT during the period, compared with ₦3.10 trillion in statutory allocations. Statutory allocation covers states’ regular share of Federation Account revenue, excluding the 13% derivation paid to oil-producing states. The gap was widest in February 2026, when states received ₦536 billion in VAT allocations against ₦209.7 billion in statutory allocations. VAT accounted for about 62% of total receipts by states that month. The figures underline the growing importance of consumption taxes in funding state governments, compared with traditional Federation Account revenue.

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