By Jane Okafor, Abuja
The Federal Government, 36 states and 774 local government councils shared N2.338 trillion from the Federation Account in August 2026, despite a sharp decline in statutory revenue during the month.
The Federation Account Allocation Committee (FAAC), at its September meeting in Abuja, approved the distribution of the funds among the three tiers of government and states entitled to derivation revenue.
The distributable amount comprised N1.565 trillion in statutory revenue and N773.233 billion from Value Added Tax (VAT).
According to figures contained in the FAAC communiqué and released on Thursday by Bawa Mokwa, Director of Press and Public Relations in the Office of the Accountant-General of the Federation, the Federation Account recorded gross revenue of N3.685 trillion during the month.
However, N125.142 billion was deducted as the cost of revenue collection, while N1.221 trillion was set aside for transfers, refunds and savings.
This left N2.338 trillion available for distribution.
The Federal Government received N804.897 billion, while the 36 states shared N794.313 billion. Local government councils received N555.142 billion, while N184.388 billion was distributed to states benefiting from the 13 per cent derivation principle on mineral revenue.
Statutory revenue drops sharply
The biggest change in August came from statutory revenue, whose gross figure fell to N2.850 trillion from N4.359 trillion in July.
The N1.508 trillion month-on-month decline represents a substantial reduction in the revenue available from statutory sources.
Despite the setback, higher VAT receipts provided some relief to the Federation Account.
Gross VAT revenue available for distribution rose to N834.843 billion in August, up N40.875 billion from the N793.968 billion recorded in July.
Of the N1.565 trillion distributable statutory revenue, the Federal Government received N727.573 billion, states got N369.035 billion and local governments received N284.511 billion.
A further N184.388 billion went to benefiting states as derivation revenue.
From the N773.233 billion distributable VAT pool, the Federal Government received N77.323 billion, states received N425.278 billion and local governments got N270.632 billion.
Mixed revenue performance
The August figures reflected divergent movements across the Federation’s major revenue sources.
FAAC reported significant increases in receipts from Petroleum Profit Tax, Hydrocarbon Tax, VAT, Customs and Excise Duty during the month.
These gains were, however, offset by declines in Companies Income Tax, Capital Gains Tax, Stamp Duty Tax, petroleum royalties, mineral royalties, gas-flaring penalties, import duty, rental gas-flaring fees and other miscellaneous oil revenue.
The figures highlight the changing mix of government revenue, with VAT providing increased support to the distributable pool as statutory receipts weakened.
FAAC allocations remain a major source of monthly funding for the federal, state and local governments, helping them meet recurrent obligations and finance infrastructure and public services.
The August distribution consequently reflects not only revenue generated during the month but also the deductions, transfers, refunds and savings made before the funds were shared among the three tiers of government.
