FAAC Distributes N2.55 Trillion as June Revenue Surges 32.6% to N4.5 Trillion

By Benson Daniel

The Federation Account Allocation Committee (FAAC) has shared a total of N2.55 trillion among the Federal Government, state governments and local government councils after gross revenue available for June rose by 32.6 per cent to approximately N4.5 trillion, reflecting improved earnings from key revenue sources.

The increase in distributable revenue marks one of the strongest monthly performances in recent times and underscores the impact of improved tax collections, stronger non-oil revenue mobilisation and sustained reforms aimed at strengthening public finances.

At the monthly FAAC meeting, representatives of the federal, state and local governments approved the distribution after deducting statutory transfers, collection costs and other obligations from the gross revenue pool.

The June revenue comprised proceeds from Value Added Tax (VAT), Companies Income Tax (CIT), Petroleum Profit Tax, Electronic Money Transfer Levy, Customs duties, Excise duties and revenues generated by government-owned enterprises. Improved remittances from some revenue-generating agencies also contributed to the higher earnings recorded during the month.

The Federal Government received its constitutional share of the allocation, while the 36 states and the 774 local government councils also received their respective portions in accordance with the revenue-sharing formula. Oil-producing states further benefited from the statutory 13 per cent derivation allocation.

Economic analysts say the improved revenue performance provides governments at all levels with greater fiscal capacity to finance infrastructure projects, settle salary obligations, improve healthcare and education services, and execute capital projects contained in their respective budgets.

The development comes at a time when state governments are under increasing pressure to improve internally generated revenue while meeting rising expenditure demands driven by inflation, population growth and expanding public service obligations.

Experts, however, cautioned that increased allocations alone may not automatically translate into improved living conditions unless accompanied by prudent financial management, transparency and efficient project implementation. They stressed the need for governments to channel the additional resources toward productive investments capable of stimulating economic growth, creating jobs and improving social welfare.

They also noted that while oil revenue remains an important source of national income, Nigeria must continue to strengthen non-oil revenue generation through tax reforms, expanded industrial production, digital economic activities and improved compliance across all sectors.

The stronger June revenue performance is expected to provide temporary fiscal relief for many states that depend heavily on monthly FAAC allocations to finance recurrent expenditure and development projects. It may also enhance liquidity across the public sector and support ongoing efforts to stabilise the economy.

As governments begin implementing the newly distributed funds, stakeholders are calling for greater accountability and transparency to ensure the resources deliver tangible benefits to citizens through improved infrastructure, quality public services and sustainable economic development.