The first month of 2025 saw a significant boost in revenue allocations to the three tiers of government in Nigeria – the Federal Government, State Governments, and Local Government Councils. A total of N1.703 trillion was shared, marking a substantial 19.6% increase, equivalent to N279 billion, compared to the N1.424 trillion distributed in December 2024. This surge in revenue reflects positive economic indicators and improved revenue generation across various sectors. The distributed amount comprised several revenue streams, including statutory revenue, Value Added Tax (VAT), Electronic Money Transfer Levy (EMTL), and augmentation funds, underscoring the diverse sources contributing to the nation’s fiscal strength.
A detailed breakdown of the N1.703 trillion reveals the composition of the distributed funds. Statutory revenue contributed N749.727 billion, representing a significant portion of the total. VAT revenue followed closely with N718.781 billion, highlighting the growing importance of consumption-based taxes. The EMTL, a relatively new revenue stream, contributed N20.548 billion, while augmentation funds added N214 billion to the total. This diverse revenue base demonstrates the government’s efforts to diversify its income sources and reduce reliance on specific sectors.
The allocation of these funds followed established distribution formulas, ensuring a fair and equitable sharing among the different tiers of government. The Federal Government received the largest share, amounting to N552.591 billion. State Governments received a collective allocation of N590.614 billion, empowering them to address state-specific developmental needs. Local Government Councils received N434.567 billion, enabling them to provide essential services at the grassroots level. In addition, N125.284 billion, representing 13% of mineral revenue, was distributed to oil-producing states as derivation revenue, acknowledging their contributions to the nation’s resource wealth.
The January 2025 gross revenue, the total revenue collected before deductions and transfers, reached N2.641 trillion, slightly exceeding the N2.310 trillion generated in December 2024. This marginal increase suggests a stable revenue generation trend, despite fluctuations in specific revenue streams. After deducting the cost of collection, which amounted to N107.786 billion, and accounting for transfers, interventions, refunds, and savings, totaling N830.663 billion, the remaining N1.703 trillion was available for distribution to the three tiers of government.
A closer look at the individual revenue streams reveals the underlying dynamics contributing to the overall revenue performance. Gross statutory revenue for January 2025 stood at N1.848 trillion, a significant increase of N622.125 billion from the N1.226 trillion recorded in December 2024. Gross VAT revenue also experienced a substantial increase, rising by N122.325 billion to reach N771.886 billion in January, compared to N649.561 billion in December. These increases indicate positive economic activity and improved tax compliance across various sectors.
While most revenue streams showed positive growth, the EMTL and Oil and Gas Royalty receipts experienced significant decreases. This contrasting performance highlights the volatility of certain revenue sources and the need for continuous monitoring and adjustment of revenue generation strategies. The increases in collections from VAT, Petroleum Profit Tax, Companies Income Tax, Excise Duty, Import Duty, and CET Levies suggest a healthy and diversifying economy. The government’s focus on improving tax administration and broadening the tax base appears to be yielding positive results. The provided data reflects a snapshot of the nation’s fiscal health in January 2025, indicating positive trends in revenue generation and allocation.
