Revenue shared among Nigeria’s three tiers of government reached N31.46tn between January and September 2026, exceeding the full-year collections recorded in 2021, 2022, 2023 and 2024, according to a report by Agora Policy.
The report, titled Ten Insights from FAAC Disbursements for January–September 2026, showed that the Federation Account Allocation Committee generated N31.46tn during the first nine months of the year, compared with N28.74tn for the whole of 2024 and N35.81tn recorded in 2025.
The findings indicate substantial growth in government revenue in nominal terms. However, the report cautioned that monthly collections remained volatile, revenue growth was slowing and earnings from minerals were significantly below budget expectations.
According to the report, which was obtained on Wednesday, the Federal Government received approximately N7.35tn from the distributions during the nine-month period. State governments received N7.01tn, while local governments received N4.92tn.
The report explained that the October FAAC meeting followed the completion of revenue distributions for January to September 2026. It noted that the figures reflected continued nominal growth but highlighted concerns about fluctuations in monthly receipts and the shortfall in mineral revenue.
Breakdown of revenue and deductions
Of the N31.46tn gross revenue generated during the period, statutory revenue accounted for N24.25tn, representing 77.1 per cent of the total.
Value Added Tax contributed N7.21tn, equivalent to 22.9 per cent.
However, only N20.36tn, or approximately 65 per cent of gross revenue, was available for distribution before augmentation. The remaining N11.10tn, representing 35 per cent, was deducted for savings, interventions, refunds, transfers and collection costs.
The report also stated that oil-producing states received N1.53tn under the 13 per cent derivation principle, which allocates a portion of oil revenue to the states where the resources are extracted.
Including an additional N450bn augmentation, total distributions amounted to N20.81tn.
Revenue exceeds previous annual totals
Agora Policy’s analysis showed that the N31.46tn collected in the first nine months of 2026 was 240.8 per cent higher than the N9.23tn recorded for the whole of 2021.
It was also 154.5 per cent above the N12.34tn collected in 2022, 93.2 per cent higher than the N16.28tn generated in 2023 and 9.5 per cent above the N28.74tn recorded in 2024.
The report stressed that these comparisons were based on nominal figures and did not account for inflation or changes in the purchasing power of the naira.
Between January and September 2025 and the corresponding period in 2026, gross FAAC revenue rose by N3.51tn, or 12.6 per cent, from N27.95tn to N31.46tn.
Despite the increase, the pace of growth had slowed. The N3.51tn rise recorded in the first nine months of 2026 was less than half the N8.97tn increase reported during the corresponding period of 2024.
According to the report, the sharp rise in revenue in 2024 followed the foreign exchange and petrol subsidy reforms introduced in 2023, which may have contributed to the increase in naira-denominated receipts.
It added that the implementation of tax reforms and higher oil prices associated with the conflict in Iran might also have supported revenue growth in 2026. However, the aggregate figures were insufficient to determine the precise contribution of each factor.
Average monthly gross revenue during the first nine months of 2026 stood at N3.50tn, compared with N2.98tn for the whole of 2025.
The report noted that annual FAAC revenue increased from N9.23tn in 2021 to N35.81tn in 2025, with the largest annual increase occurring in 2024, when collections rose by 76.5 per cent from N16.28tn to N28.74tn.
By the end of September 2026, the cumulative revenue figure had reached approximately 88 per cent of the total recorded for the whole of 2025.
Agora Policy estimated that if the monthly collection pace continued, full-year gross revenue could reach about N41.95tn. It clarified, however, that this was a simple annualised estimate rather than a formal forecast, as seasonal variations could affect collections in the remaining months.
The report also warned that changes in crude oil prices and foreign exchange rates could either increase or reduce government revenue before the end of the year.
Source: The Punch
