Rising VAT Cushions Revenue Drop as FAAC Distributes N2.35trn
The Federal Government, states and local government councils shared N2.35 trillion from the Federation Account as revenue for August.
The allocation was made at the Federation Account Allocation Committee (FAAC) meeting held on Tuesday in Abuja.
According to a communiqué issued after the meeting, the distributable revenue of N2.35 trillion comprised N1.48 trillion statutory revenue, N672.90 billion Value Added Tax (VAT), N32.34 billion from the Electronic Money Transfer Levy (EMTL), and N41.28 billion from Exchange Difference.
The total gross revenue for August stood at N3.64 trillion. Out of this, N124.84 billion was deducted for collection costs, while N1.29 trillion was set aside for transfers, interventions, refunds, and savings.
The communiqué noted that VAT revenue rose to N722.62 billion in August, compared with N687.94 billion in July—an increase of N34.68 billion.
Breakdown of the statutory revenue shows that the Federal Government received N684.46 billion, state governments N347.17 billion, and local governments N267.65 billion. Oil-producing states received N179.31 billion as 13 per cent derivation revenue.
From the N672.90 billion VAT revenue, the Federal Government got N100.94 billion, states N336.45 billion, and local governments N235.52 billion.
Out of the N32.34 billion EMTL revenue, the Federal Government received N4.85 billion, states N16.17 billion, and local governments N11.32 billion.
From the N41.28 billion Exchange Difference, the Federal Government got N19.80 billion, state governments N10.04 billion, and local governments N7.74 billion, while oil-producing states received N3.70 billion as derivation revenue.
The communiqué further disclosed that gross statutory revenue in August stood at N2.84 trillion, representing a drop of N231.91 billion compared with the N3.07 trillion recorded in July.
It explained that oil and gas royalties, VAT, and Common External Tariff (CET) levies recorded increases, while Petroleum Profit Tax (PPT), Companies Income Tax (CIT), import duty, EMTL, and excise duty declined.
