Nigerian states receive N2.37tn in VAT revenue during first half of 2026 under new tax regime
via Punch Nigeria16 min read
Nigerian state governments collectively received N2.37tn from Value Added Tax revenue in the first half of 2026, marking a N451.25bn increase compared to the same period in 2025. This 23.48% rise in states' VAT allocation is attributed to higher distributable VAT collections and a new vertical sharing formula implemented on January 1, 2026. Under the revised tax laws, the states' portion of distributable VAT increased to 55% from 50%, while the Federal Government's share decreased from 15% to 10%. Local governments' allocation remained at 35%. This adjustment transferred approximately N215.72bn from the Federal Government to the states from the N4.31tn total distributable VAT pool in H1 2026. Overall, a total of N13.04tn in distributable federation revenue was shared among the three tiers of government during this period, an increase of N2.92tn from H1 2025. The Federal Government received N4.57tn, state governments received N4.47tn excluding derivation payments, and local government councils received N3.13tn. Oil-producing states also received N864.89bn in 13% mineral revenue derivation. Experts like the Chief Executive Officer of NESG, Dr. Tayo Aduloju, and the International Monetary Fund have warned that maintaining the current VAT rate without an increase could lead to revenue shortfalls for the Federal Government, despite the benefits to states. However, the current Minister of Finance and Coordinating Minister of the Economy, Mr. Taiwo Oyedele, projected that states cou
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President Bola Tinubu has approved the appointment of 26 individuals to the boards and leadership of 10 federal government agencies and commissions. These appointments, which are effective immediately, were announced by the President’s Special Adviser on Information and Strategy, Bayo Onanuga. Among the key appointments, former Ekiti State Governor, Ayo Fayose, has been named Chairman of the Rural Electrification Agency REA. Major General Junaid Bindawa will serve as Chairman of the National Salary and Wages Commission, with eight additional appointments made to this commission, including Olajumoke Okoya-Thomas as Secretary. Other notable appointments include Dr Abuh Mohammed as Director-General of the National Population Commission, Dr Akinola Odeyemi as Managing Director of the Nigerian Bulk Electricity Trading Plc, and Dr Anthony Inalegwu Godwin as Chairman and Chief Executive Officer of the Nigeria Atomic Energy Commission. Engineer Julius Oloro is the new Chief Executive Officer of the National Centre for Agricultural Mechanisation. The board of the Fiscal Responsibility Commission has also been constituted with Dr Abdullahi Maikano Saidu as chairman. Additionally, Shuni Muhammad Dahiru has been appointed Executive Secretary of the National Commission for Mass Literacy, Adult and Non-Formal Education, and Gisaor Vincent Iorja is the new Executive Director Finance of the Federal Housing Authority.
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