The Federation Account Allocation Committee (FAAC) has approved the disbursement of a total of ₦3.007 trillion to the Federal Government, the 36 state governments and the 774 local government councils as revenue for July 2026.
At a meeting held in Owerri, Imo State, FAAC said the Federal Government received a total of ₦1.146 trillion, while the state governments received ₦943.352 billion and the local government councils received ₦673.649 billion. A total of ₦243.478 billion, representing 13 per cent of mineral revenue, was also shared with the benefiting states as derivation revenue.
According to a statement by Bawa Mokwa, Director of Press and Public Relations, Office of the Accountant-General of the Federation, “the month’s figures point to a strengthening underlying revenue base. Gross statutory revenue rose to ₦4.359 trillion in July 2026, up ₦658.087 billion, or 17.8 per cent, from ₦3.700 trillion in June 2026, reflecting improved collection performance across oil and non-oil statutory sources.
“Gross VAT revenue held broadly steady at ₦793.968 billion, a marginal decline of ₦5.778 billion, or 0.7 per cent, from ₦799.746 billion in June, suggesting consumption-tax receipts remain resilient month-on-month.”
The statement noted that the FAAC session discussed the state of the economy, fiscal governance, and federal and subnational fiscal fitness.
The session also set out the scale of the recent revenue windfall and called for deliberate reforms to convert it into durable fiscal strength rather than a temporary gain.
“The meeting acknowledged that gross FAAC have risen significantly over the past three years, driven by subsidy removal, exchange-rate unification and tax reform.”
Furthermore, the statement explained that the meeting highlighted the impact of the Nigeria Tax Act 2025, which took effect on January 1, 2026.
Under the new arrangement, the states’ share of VAT revenue rose from 50 per cent to 55 per cent, while the Federal Government’s share fell from 15 per cent to 10 per cent. Also, 30 per cent of the states’ VAT pool is now allocated based on the place of consumption rather than a company’s registered headquarters, directly linking a state’s economic activity to the size of its federation allocation.
The communiqué attributed the month’s gains to broad-based strength across several revenue lines. Petroleum Profit Tax (PPT), Hydrocarbon Tax (HT), Companies Income Tax (CIT), Capital Gains Tax (CGT), Stamp Duty Tax (SDT), petroleum royalties, mineral royalties, excise duty and gas-flaring penalties all recorded significant increases in July 2026, pointing to improved compliance and collection efficiency across both oil and non-oil channels.
“These gains were partly offset by declines in Value Added Tax (VAT), Import Duty, CET Levies, Rental of Gas Flared Fee and Miscellaneous Oil Revenue, which the Committee will continue to monitor as it works with revenue-generating agencies to close collection gaps and improve remittance discipline.”
The Committee reaffirmed its commitment to full, transparent and timely remittance of collectible revenue by all revenue-generating agencies into the Federation Account ahead of the accounts reconciliation exercise for the period.
It also reaffirmed its commitment to diversifying the federation’s revenue base beyond oil, in line with ongoing tax administration and non-oil revenue mobilisation reforms.
The Committee further emphasised alignment between FAAC’s technical work and the NACOFED platform, reinforcing coordination between the Federal Government and states on fiscal policy, revenue-sharing and shared economic development priorities.
It also resolved to continue monitoring solid minerals and other non-oil royalty streams as potential growth areas for future federation revenue.
“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 (MDAs), and reiterated its support for reforms aimed at improving the predictability and growth of allocations to all three tiers of government,” the statement noted.
