Nigeria’s Three Tiers of Government Share N786.161 Billion in May 2023 Federation Allocation

Nigeria’s Three Tiers of Government Share N786.161 Billion in May 2023 Federation Allocation

…By Enitan Thompson for TDPel Media. The Federation Account Allocation Committee (FAAC) recently announced the distribution of N786.161 billion as the federation allocation for the month of May 2023.


This amount was shared among the three tiers of government in Nigeria.

The statement was made by Stephen Kilebi, the Director of Press and Public Relations of the Federal Ministry of Finance, Budget, and National Planning.

Distribution of Funds:

The allocated amount included various sources of revenue such as Gross Statutory Revenue, Value Added Tax (VAT), Electronic Money Transfer Levy (EMTL), and Exchange Difference.


Among the total amount, the Federal Government received N301.889 billion, states were allocated N265.875 billion, Local Government Areas (LGAs) received N195.541 billion, and the oil-producing states received N22.855 billion as derivation, which represents 13% of the mineral revenue.

Increase in VAT Revenue:

FAAC reported an increase in the gross revenue from VAT for the month of May.

The amount rose to N270.197 billion compared to the N217.743 billion distributed in the previous month.

Out of this revenue, N10.808 billion was allocated for collection costs, N7.782 billion for transfers and refunds, and the remaining N251.607 billion was distributed among the three tiers of government.

The Federal Government received N37.741 billion, states received N125.804 billion, and LGAs were allocated N88.062 billion.


Higher Gross Statutory Revenue:

The Gross Statutory Revenue for May amounted to N701.787 billion, surpassing the N497.463 billion received in April.

After deducting the allocated amounts, a balance of N519.545 billion remained.

This balance was distributed as follows: the Federal Government received N261.686 billion, states received N132.731 billion, LGAs received N102.330 billion, and oil derivation received N22.798 billion.

Electronic Money Transfer Levy (EMTL):

From the EMTL revenue, a total of N14.969 billion was distributed among the three tiers of government.

The Federal Government received N2.155 billion, states received N7.185 billion, LGAs received N5.030 billion, and N0.599 billion was allocated for the cost of collection.


Changes in Tax Revenues:

Significant increases were observed in Petroleum Profit Tax (PPT), Companies Income Tax (CIT), Oil and Gas Royalties, Import and Excise Duties, and VAT.

However, the Electronic Money Transfer Levy (EMTL) revenue showed a marginal decrease.

Excess Crude Account and NNPC Remittance:

As of June 22, 2023, the balance in the Excess Crude Account (ECA) stood at $473,754.57.

It is important to note that the Nigerian National Petroleum Corporation Limited (NNPCL) did not remit any money into the federation account.

FAAC has previously accused NNPCL of withholding over N2 trillion in crude sales, royalties, and taxes owed to the federation account.


On the other hand, the NNPC claimed that the Federal Government owed them over N4 trillion in subsidy payments, power debt, and other charges.

Consequently, the NNPC stated that it would only remit funds once its debts were recovered.


The federation allocation for May 2023 has been distributed among the Federal Government, states, LGAs, and oil-producing states.

The increase in VAT revenue and the higher Gross Statutory Revenue contributed to the larger allocation.

However, the issue of non-remittance by the NNPC remains a point of contention between the corporation and FAAC, as both parties claim the other owes a significant debt.


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