The Federal Government, states and local government areas have shared a record N3 trillion from the Federation Account for July 2026, marking the highest monthly allocation distributed under President Bola Ahmed Tinubu’s administration.
This was announced after the August 2026 meeting of the Federation Account Allocation Committee (FAAC), held in Owerri, Imo State, and chaired by Taiwo Oyedele, Minister of Finance and Coordinating Minister of the Economy.
The July allocation represents a significant increase from the N2.551 trillion shared among the three tiers of government for June 2026.
Compared with the previous month, the latest allocation increased by N456 billion, representing a 17.9 per cent rise.
How the N3 trillion was shared
According to the FAAC communiqué issued through the Office of the Accountant-General of the Federation, the Federal Government received N1.146 trillion from the July revenue.
State governments received N943.352 billion, while local government councils received N673.649 billion.
In addition, N243.478 billion, representing 13 per cent derivation revenue from mineral resources, was shared among the benefiting states.
The figures highlight the continued importance of monthly FAAC allocations to the finances of Nigeria’s three tiers of government, particularly as states and local governments depend heavily on federally collected revenue to fund salaries, infrastructure and other public services. Nigeriannews portal
What drove the record allocation?
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FAAC attributed the increase mainly to stronger collections from oil and non-oil revenue sources.
Gross statutory revenue rose to N4.359 trillion in July from N3.700 trillion in June.
That represents an increase of N658.087 billion, or 17.8 per cent, within one month.
The committee said higher collections were recorded from several revenue streams, including Petroleum Profit Tax, Hydrocarbon Tax, Companies Income Tax, Capital Gains Tax, Stamp Duty Tax and petroleum royalties.
According to FAAC, the improvement reflected better compliance and increased efficiency in revenue collection across both oil and non-oil sources.
However, not all revenue streams recorded growth.
VAT and other revenues record declines
Value Added Tax (VAT) revenue remained relatively stable but fell slightly during the month.
Gross VAT collections stood at N793.968 billion in July, compared with N799.746 billion in June.
This represents a decline of N5.778 billion, or 0.7 per cent.
FAAC also recorded declines in import duty, Common External Tariff (CET) levies, rental fees from gas flaring and miscellaneous oil revenue.
The committee said it would continue monitoring the affected revenue streams and work with revenue-generating agencies to address collection gaps.
Revenue reforms remain central
The latest figures could provide some relief for governments at all levels, but FAAC stressed that sustaining the increase would require stronger discipline in revenue collection and remittance.
The committee reaffirmed its commitment to ensuring that all collectible revenue is fully, transparently and promptly remitted into the Federation Account.
It also said efforts would continue to diversify government revenue beyond oil through ongoing tax administration and non-oil revenue mobilisation reforms.
FAAC further called for closer coordination between its technical activities and the National Council of Federation and Economic Development (NACOFED) platform.
The aim, according to the committee, is to improve coordination between the Federal Government and states on fiscal policy, revenue sharing and economic development priorities.
What the N3 trillion means for states and LGs
The record allocation comes at a time when governments across the country are under pressure to fund public services, pay workers and finance development projects.
For states and local governments, higher FAAC receipts could provide additional fiscal space for infrastructure, healthcare, education and other public spending.
However, the increase also highlights the importance of maintaining the revenue gains rather than relying solely on fluctuations in monthly allocations.
FAAC said it remained committed to reforms aimed at making revenue collection and allocations more predictable and sustainable across the three tiers of government.
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