The Federation Account Allocation Committee, FAAC, held its August 2026 meeting in Owerri, Imo State, on the sidelines of the National Council on Federation and Economic Development, NACOFED. Beyond approving July revenue sharing, the meeting focused on converting Nigeria’s recent revenue growth into lasting fiscal strength for all tiers of government.

‎FAAC noted that gross allocations have risen significantly over the past three years, driven by fuel subsidy removal, exchange rate unification and tax reforms. The Committee stressed the need for deliberate reforms to ensure the current windfall becomes durable strength, not a temporary gain.

‎The meeting highlighted key provisions of the Nigeria Tax Act 2025, which took effect January 1st, 2026. States’ share of VAT revenue has increased from 50% to 55%, while the Federal Government’s share dropped from 15% to 10%. Also, 30% of the states’ VAT pool will now be shared based on place of consumption, linking a state’s economic activity directly to its allocation.

Commissioners of Finance and Accountants-General were urged to strengthen six “vital signs” of fiscal health. These include improving revenue quality, putting idle state assets to productive use, growing state economies, attracting investment, investing in education and health, and ensuring timely, audited and transparent public accounts.

‎In its regular business, FAAC approved the disbursement of ₦3.007 trillion to the Federal Government, 36 states and 774 local governments for July 2026. Gross statutory revenue rose to ₦4.359 trillion, a 17.8% increase from ₦3.700 trillion in June, reflecting stronger oil and non-oil collections.

‎Gross VAT revenue stood at ₦793.968 billion, a marginal decline of 0.7% from June’s ₦799.746 billion. The Committee said consumption-tax receipts remain resilient despite the slight dip.

According to the communiqué, Petroleum Profit Tax, Companies Income Tax, Royalties, Stamp Duty and other levies recorded significant increases in July. These gains were partly offset by declines in VAT, Import Duty and miscellaneous oil revenue, which FAAC said it will continue to monitor with revenue agencies.

‎FAAC reaffirmed commitment to full and timely remittance into the Federation Account and to diversifying revenue beyond oil. The Committee also stressed alignment with NACOFED to improve coordination between federal and state governments. It urged all MDAs to sustain collection discipline to keep allocations predictable and growing.