FAAC Reports Decline In VAT Revenue, Distributes N1.678 Trillion To Governments.
The Federation Accounts Allocation Committee (FAAC) has reported a decline in Value Added Tax (VAT) revenue for February 2025, with collections dropping by N117.430 billion, from N771.886 billion in January to N654.456 billion. This reduction, along with declines in Petroleum Profit Tax (PPT), Companies Income Tax (CIT), Excise Duty, Import Duty, and CET Levies, impacted the total revenue available for distribution to the three tiers of government.
According to a communiqué issued at the conclusion of FAAC’s March 2025 meeting in Abuja, the gross statutory revenue shared totalled N1.653 trillion, representing a decrease of N194.664 billion from the N1.848 trillion allocated in January 2025.
Breakdown of Distributable Revenue
FAAC disclosed that the total distributable revenue for March amounted to N1.678 trillion, comprising:
– N827.633 billion from distributable statutory revenue,
– N609.430 billion from distributable VAT revenue,
– N35.171 billion from the Electronic Money Transfer Levy (EMTL),
– N28.218 billion from Solid Minerals revenue, and
– N178 billion as an augmentation.
The meeting, chaired by Minister of Finance and Coordinating Minister of the Economy, Wale Edun, also had in attendance the newly appointed Accountant General of the Federation, Shamseldeen Ogunjimi.
Revenue Distribution Among Government Tiers
From the N1.678 trillion total distributable revenue:
– The Federal Government received N569.656 billion,
– The State Governments received N562.195 billion,
– The Local Government Councils received N410.559 billion, and
– N136.042 billion, representing 13 percent of mineral revenue, was allocated to benefiting states as derivation revenue.
Within the N827.633 billion distributable statutory revenue, allocations were as follows:
– Federal Government: N366.262 billion,
– State Governments: N185.773 billion,
– Local Government Councils: N143.223 billion,
– Benefiting states (derivation revenue): N132.374 billion.
For the N609.430 billion VAT revenue, the distribution was:
– Federal Government: N91.415 billion,
– State Governments: N304.715 billion,
– Local Government Councils: N213.301 billion.
From the N35.171 billion EMTL revenue:
– Federal Government: N5.276 billion,
– State Governments: N17.585 billion,
– Local Government Councils: N12.310 billion.
From the N28.218 billion Solid Minerals revenue:
– Federal Government: N12.933 billion,
– State Governments: N6.560 billion,
– Local Government Councils: N5.057 billion,
– Benefiting states (derivation revenue): N3.668 billion.
The N178 billion augmentation was shared as follows:
– Federal Government: N93.770 billion,
– State Governments: N47.562 billion,
– Local Government Councils: N36.668 billion.
Increase in Oil and Gas Royalty and EMTL
Despite the decline in VAT and other revenue sources, FAAC noted a significant increase in Oil and Gas Royalty and the Electronic Money Transfer Levy (EMTL) in February.
The latest revenue figures highlight the financial challenges facing government finances while demonstrating the Federal Government’s continued efforts to allocate resources efficiently across all tiers.
