FAAC distributes N1.36tn among Gov’t tiers for July 2024

The Federation Account Allocation Committee (FAAC) has announced the distribution of N1.36 trillion to the federal, state, and local governments as part of the Federation Allocation for July 2024.

The announcement was made following the FAAC’s August 2024 meeting, presided over by the Minister of Finance and Coordinating Minister of the Economy, Wale Edun.

This allocation is drawn from a gross total of N2.61 trillion, marking a significant financial injection into the various levels of government.

According to a statement by the Ministry of Finance, signed by the Director of Information and Public Relations, Mohammed Manga, the allocation was divided as follows:

–  Federal Government: N431.1 billion
–  State Governments: N473.5 billion
–  Local Government Councils: N343.7 billion

The statement further detailed that the significant contributors to the revenue were Oil and Gas Royalty, Petroleum Profit Tax, Value Added Tax (VAT), Import Duty, Electronic Money Transfer Levy, and External tariff levies. However, Companies Income Tax saw a decrease, while Excise Duties experienced a slight increase.

This allocation is critical as it underpins the financial operations and development projects across the three tiers of government.

The increase in oil and gas revenue and VAT collections is particularly noteworthy, reflecting improved economic activities and tax compliance. Conversely, the decrease in Companies Income Tax could indicate challenges in the corporate sector that may need to be addressed.

The communique read, “From the stated amount (N2.61tn) inclusive of Gross Statutory Revenue, Value Added Tax, Electronic Money Transfer Levy, Exchange Difference, and N13.647 Billion from Solid Mineral Revenue, the Federal Government received N431.079 Billion, the States received N473.477 Billion, the Local Government Councils got N343.703 Billion, while the Oil Producing States received N109.816 Billion as Derivation, (13 per cent of Mineral Revenue).

“The sum of N99.756 Billion was given for the cost of collection, while N109.816 Billion was allocated for Transfers Intervention and Refunds.”

The communique indicated that the Gross Revenue available from the Value Added Tax for the month of July 2024, was N625.33bn as against N562.69bn distributed in the preceding month, resulting in an increase of N62.64bn.

“From that amount, the sum of N25.01bn was allocated for the cost of collection and the sum of N18.01bn was given for Transfers, Intervention and Refunds.

“The remaining sum of N582.31bn was distributed to the three tiers of government, of which the Federal Government got N87.37bn, the States received N291.15bn and Local Government Councils got N203.81bn.”

Manga said the Gross Statutory Revenue of N1.37tn received for the month was lower than the sum of N1.43bn received in the previous month by N45.52bn.

“From the stated amount, the sum of N73.959bn was allocated for the cost of collection and a total sum of N1.14tn for Transfers, Intervention and Refunds.

“The remaining balance of N161.593 Billion was distributed as follows to the three tiers of government: Federal Government got the sum of N58.55bn, States received N29.69bn, the sum of N22.89bn was allocated to LGCs and N50.46bn was given to Derivation Revenue (13 per cent Mineral producing States).

“Also, the sum of N19.6bn from the Electronic Money Transfer Levy was distributed to the three tiers of government as follows: the Federal Government received N2.82bn, States got N9.41bn, Local Government Councils received N6.59bn, while N0.784bn was allocated for Cost of Collection.”

The communique further disclosed the sum of N581.71bn from Exchange Difference, which was shared as follows: Federal Government received N276.11bn, States got N140.02bn, the sum of N107.97bn was allocated to Local Government Councils, N57.58bn was given for Derivation (13 per cent of Mineral Revenue).”

It added that the sum of N13.647bn from Solid Mineral Revenue, which was shared as follows: the Federal Government got N6.255bn, the States received the sum of N3.17bn, Local Government Councils received N2.446bn, while the sum of N1.77bn was allocated to Deviation (13 per cent of Mineral Revenue).

According to the communique, the total revenue distributable for the current month of July 2024, was drawn from Statutory Revenue of N161.59bn, Value Added Tax of N528.31bn, N18.82bn from Electronic Money Transfer Levy, N581.71bn from Exchange Difference and the sum of N13.65bn, bringing the total distributable amount for the month to N1.358.1tn.

“The balance in the Excess Crude Account as of August 2024 stands at $473,754.57.”

While welcoming the Federation Account Allocation Committee, the minister commended the committee for their show of support especially during the recent protest.

He urged them to continue to support the efforts of the Federal Government in its determination to transform Nigeria’s economy for the future of our nation and further commended Tinubu, “for signing the National Minimum Wage Act into law, adding that its implementation will be of immense benefit to all Nigerians.”