The Nigerian government has taken a significant step toward economic stability and infrastructural development with the disbursement of N1.703tr among the federal, state, and local governments for January 2025.
This allocation, approved by the Federation Account Allocation Committee (FAAC) at its February meeting, underscores the administration’s commitment to strengthening governance at all levels through improved revenue-sharing mechanisms.
The Honourable Minister of Finance and Coordinating Minister of the Economy, Wale Edun, who chaired the meeting, emphasized the importance of the increased revenue in fostering sustainable growth, enhancing service delivery, and addressing key development priorities across the country.
Director of Information and Public Relations, Mohammed Manga in a statement said with a gross total of N2.641 trillion, the January revenue was sourced from Statutory Revenue, Value Added Tax (VAT), and Electronic Money Transfer Levy (EMTL), among others.
The distribution according to the statement saw the Federal Government receive N552.591b while states and local governments got N590.614b and N434.567b, respectively.
In addition, he said oil-producing states were allocated N125.284 billion under the 13% derivation formula.
To ensure efficiency in revenue collection and fiscal management, N107.786b was set aside for collection costs, while N830.663b was earmarked for transfers, interventions, and refunds.
The substantial increase in VAT revenue (N771.886
b)—an improvement of N122.325b from the previous month—is expected to provide states and local governments with enhanced fiscal capacity to invest in critical sectors such as education, healthcare, and infrastructure.
Similarly, the boost in statutory revenue (N1.848tr, up by N622.125b from the prior month) underscores improved economic activities and tax compliance.
The distributed funds will enable states and local governments to strengthen healthcare systems by improving access to medical facilities, hiring personnel, and ensuring the availability of essential drugs.
According to the Statement it will also enhance educational initiatives, including school renovations, teacher recruitment, and student support programs and invest in infrastructure development, such as road construction, rural electrification, and water projects, to drive economic expansion.
It explained further that the allocation of N21.404b from EMTL and the N214b augmentation fund will further support government interventions aimed at job creation, social programs, and security enhancements.
The FAAC communique highlighted key areas of revenue performance, noting increases in Petroleum Profit Tax (PPT), Companies Income Tax (CIT), Excise Duty, Import Duty, and CET Levies. However, Electronic Money Transfer Levy (EMTL) and Oil and Gas Royalty recorded slight declines.
By ensuring effective utilization of these funds, the state indicated that the government’s aim is to promote economic resilience, reduce poverty, and enhance the standard of living for Nigerians.
The increased transparency in fiscal operations, alongside improved budget implementation at all levels, is expected to boost investor confidence and stimulate economic growth.
The N1.703tr allocation reflected the Nigerian government’s ongoing efforts to strengthen fiscal federalism and drive inclusive development. With a focus on prudent financial management, accountability, and strategic investment, this revenue distribution is set to create socioeconomic opportunities, enhance governance, and improve service delivery nationwide.
As states and local governments deploy their share of the funds, the real impact will be measured in the transformation of public services, economic growth, and overall improvement in the lives of Nigerians.
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