FAAC Shares N2.55tn June Revenue as VAT Collections Rise 7.5%

FAAC Shares N2.55tn June Revenue as VAT Collections Rise 7.5%

The Federation Account Allocation Committee (FAAC) has distributed N2.55 trillion to the federal government, the 36 states and the 774 local government councils as revenue allocation for June, buoyed by higher statutory and value-added tax (VAT) collections.

The allocation was approved at FAAC's July meeting held in Abuja on Wednesday, according to a statement issued by Bawa Mokwa, director of press and public relations in the Office of the Accountant-General of the Federation.

The distributable revenue comprised N1.8 trillion from statutory revenue and N740.72 billion from VAT proceeds.

FAAC said the federation generated N4.5 trillion in gross revenue during the month. From the total, N160.74 billion was deducted as the cost of collection, while N1.78 trillion was set aside for transfers, interventions and refunds before the balance was shared among the three tiers of government.

Of the total allocation, the federal government received N923.43 billion, the state governments N838.2 billion, while local government councils got N591.39 billion. Oil-producing states also received N197.61 billion as 13 per cent derivation revenue.

The committee said gross statutory revenue rose sharply to N3.7 trillion in June from N2.65 trillion in May, representing an increase of N1.04 trillion.

VAT collections also improved, with gross revenue increasing by 7.5 per cent to N799.74 billion in June from N743.68 billion recorded in May.

From the N1.8 trillion distributable statutory revenue, the federal government received N849.36 billion, the states N430.81 billion, and local governments N332.13 billion, while oil-producing states shared N197.61 billion as derivation revenue.

Similarly, from the N740.72 billion distributable VAT revenue, the federal government received N74.07 billion, states got N407.39 billion, and local governments received N259.25 billion.

FAAC attributed the improved revenue performance to stronger collections from company income tax (CIT), capital gains tax (CGT), stamp duties, petroleum royalties, gas flaring penalties, rents, miscellaneous oil revenue, VAT, import duties and common external tariff (CET) levies.

However, the committee noted that receipts from petroleum profit tax (PPT), hydrocarbon tax (HT), mineral royalties and related fees declined during the period, while excise duty recorded only a marginal increase.