In a move to sustain the financial stability of Nigeria’s three tiers of government, the Federation Account Allocation Committee (FAAC) has disbursed a total of N1.659 trillion as revenue generated in May 2025. This figure reflects a moderate drop of N22 billion or 1.31% compared to the N1.681 trillion allocated in April 2025.
The allocation was confirmed in a press release issued on Wednesday by Bawa Mokwa, the Director of Press and Public Relations at the Office of the Accountant General of the Federation, following the monthly FAAC meeting held in Abuja in June 2025.
The disbursed revenue was distributed across the Federal Government, 36 state governments, and 774 local government areas (LGAs), adhering to the established sharing framework.
Revenue Components and Disbursement Structure
For May 2025, the gross revenue accrued to the Federation stood at N2.942 trillion, marking an increase from N2.084 trillion recorded in April. However, after deducting N111.908 billion as cost of collection and another N1.171 trillion for statutory transfers, refunds, and interventions, the net distributable amount was N1.659 trillion.
The composition of the May revenue is as follows:
- Statutory Revenue: N863.895 billion
- Value Added Tax (VAT): N691.714 billion
- Electronic Money Transfer Levy (EMTL): N27.667 billion
- Exchange Rate Gains: N76.614 billion
The statutory revenue component, which typically forms the bulk of monthly FAAC allocations, experienced a slight increase. Gross statutory inflows rose to N2.094 trillion, compared to N2.084 trillion in April.
The VAT receipts also witnessed significant growth, climbing from N642.265 billion in April to N742.820 billion in May, an increase of over N100 billion.
How the N1.659 Trillion Was Shared
From the distributable revenue pool:
- The Federal Government received N538.004 billion
- State Governments were allocated N577.841 billion
- Local Government Councils got N419.968 billion
- An additional N124.076 billion was paid as 13% derivation revenue to oil-producing states.
Breaking it down further:
Statutory Revenue – N863.895 billion:
- FG: N393.518 billion
- States: N199.598 billion
- LGAs: N153.881 billion
- Derivation Revenue: N116.898 billion (13% to oil-producing states)
VAT Revenue – N691.714 billion:
- FG: N103.757 billion
- States: N345.857 billion
- LGAs: N242.100 billion
EMTL – N27.667 billion:
- FG: N4.150 billion
- States: N13.833 billion
- LGAs: N9.683 billion
Exchange Difference Revenue – N76.614 billion:
- FG: N36.579 billion
- States: N18.553 billion
- LGAs: N14.304 billion
- Derivation Revenue: N7.178 billion
Mixed Performance in Revenue Sources
A performance review of the revenue inflows for May 2025 revealed positive movements in certain revenue lines. Companies Income Tax (CIT), VAT, and Import Duty all recorded appreciable increases.
However, several streams reported declines including Common External Tariff (CET) Levies, Petroleum Profit Tax (PPT), Oil and Gas Royalties, and the EMTL.
Excise Duty experienced only a slight improvement during the period under review.
Sustaining Government Funding Amid Revenue Fluctuations
Despite the month-on-month drop in total distributable revenue, the current allocation of N1.659 trillion reaffirms the federal government’s ongoing commitment to ensuring equitable fiscal transfers to sub-national governments. NThe robust allocations to all tiers of government are expected to support critical public sector operations and service delivery efforts across the country.
The revenue-sharing structure remains a critical mechanism in maintaining financial balance among the federal, state, and local governments in Nigeria, especially in the face of global economic challenges and domestic revenue pressures.
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