The Federation Accounts Allocation Committee (FAAC) has distributed a total of N3.4 trillion to the federal, state, and local governments in Nigeria from the beginning of the year to date, according to a recent report by FBNQuest Research. This marks a 47 percent year-on-year (YoY) increase, reflecting improved government revenue generation.

The significant allocation highlights the federal government’s commitment to fiscal stability and economic growth, with the funds expected to support key developmental projects across all tiers of government.

According to the latest FAAC communique, the total monthly disbursement for March 2025 (derived from February revenue) stood at N1.68 trillion. However, this represents a N25 billion decline compared to the previous month’s payout.

The month-on-month (MoM) reduction in revenue allocation was primarily due to a decline in value-added tax (VAT) collections, which dropped from N718.8 billion in January to N609.4 billion in February. Additionally, augmentation revenue stood at N178 billion, lower than the N214 billion received in the previous month, further contributing to the overall decline.

Despite these reductions, some revenue sources saw improvements. Statutory revenue collections increased to N827.6 billion, up from N749.7 billion, while Electronic Money Transfer Levy (EMTL) receipts also rose to N35.2 billion, compared to N20.5 billion in the previous month.

Notably, the federal government’s allocation increased by N17 billion to N570 billion, despite the overall revenue decline. However, allocations to state governments (excluding the 13 percent derivation for oil-producing states) and local governments fell by N28 billion and N24 billion, bringing their shares to N562 billion and N411 billion, respectively.

Conversely, the 13 percent derivation allocation for oil-producing states rose to N136 billion from N125 billion, driven by a significant increase in oil and gas royalty receipts.

Looking ahead, FBNQuest analysts project further expansion in government revenue collection, supported by improved non-oil revenue streams and higher oil earnings.

Copyright © 2022 Nigerian Tribune Provided by SyndiGate Media Inc. (Syndigate.info).