The federation account allocation committee (FAAC) has disclosed that a total of N3.007 trillion was shared among the federal government, states, and local government areas (LGAs) in July.

The figure represents the highest allocation shared so far under President Bola Tinubu’s administration.

In June, the FAAC allocated N2.5 trillion.
According to a statement issued by Bawa Mokwa, director of public affairs at the office of the accountant-general of the federation on Tuesday, the committee met in Owerri, Imo state, on the margins of the ongoing National Council of Federation and Economic Development (NACOFED).

FAAC said out of the total distributable revenue, the federal government received N1.14 trillion, states got N943.35 billion and the local governments received N673.64 billion.

The sum of N243.47 billion, representing 13 percent derivation revenue, was also shared with benefiting states.

FAAC also said gross statutory revenue rose to N4.35 trillion in July, representing an increase of N658.08 billion or 17.8 percent from N3.7 trillion recorded in June.

However, gross value-added tax (VAT) revenue declined marginally to N793.96 billion from N799.74 billion in June.

The committee attributed the increase in statutory revenue to higher collections from petroleum profit tax (PPT), hydrocarbon tax (HT), companies income tax (CIT), capital gains tax (CGT), stamp duty tax (SDT), petroleum royalties, mineral royalties, excise duty and gas flared penalties.

FAAC also said the gains were partly offset by declines in VAT, import duty, common external tariff (CET) levies, rental of gas-flared fees and miscellaneous oil revenue.

The committee urged the federal and state governments to use the recent increase in revenue to strengthen their fiscal positions and improve social investments.

Also, the committee said “rising allocations over the past three years, driven by subsidy removal, exchange-rate unification and tax reforms, should be converted into lasting fiscal strength rather than treated as a temporary windfall”.

According to the statement, the committee identified six areas it described as “vital signs” for strengthening the fiscal position of the federal and state governments.

The six areas, according to the statement, are improving revenue quality by diversifying internally generated revenue (IGR), putting idle government assets to productive use, expanding economic activity, attracting investment, investing in human capital and strengthening public financial management.

The committee also urged governments to institutionalise reforms, including comprehensive asset registers, payroll verification and timely publication of audited accounts over the next 12 months.