Lagos State has emerged as Nigeria’s highest recipient of Federation Account Allocation Committee (FAAC) revenue in the first half of 2026, overtaking major oil-producing states after recording N365.78 billion in net disbursements.
The figure represents a 54.39 per cent increase from the N236.92 billion received by the state during the corresponding period of 2025.
Lagos’ latest performance pushed it from third position in the first half of 2025 to the top of the national ranking, while Delta State, the previous leader, dropped to second place with N331.43 billion.
Rivers State came third with N295.99 billion, followed by Akwa Ibom with N270.27 billion and Bayelsa with N266.72 billion.
The figures show a growing influence of Value Added Tax (VAT) and broader economic activity on state revenues, alongside the traditional advantage enjoyed by oil-producing states through derivation revenue.
How Lagos did it
Lagos, which does not receive oil derivation revenue, generated the bulk of its FAAC allocation from VAT. It received N344.06 billion in net VAT disbursements during the six months, compared with N10.91 billion in net statutory revenue.
It also received N3.31 billion from the Electronic Money Transfer Levy (EMTL) and N5.05 billion in non-oil revenue augmentation, bringing its total gross allocation to N476.59 billion.
By comparison, Delta State’s N331.43 billion net allocation was substantially supported by its oil-producing status. The state received N229.71 billion in 13 per cent derivation revenue, the highest derivation allocation among the top 10 recipients.
Rivers, another major oil-producing state, received N117.33 billion in derivation revenue, while Akwa Ibom and Bayelsa received N169.29 billion and N169.26 billion, respectively.
Overall, Nigeria’s 36 states shared N4.54 trillion in net FAAC revenue between January and June 2026, up from N3.61 trillion in the same period of 2025.
The N930 billion increase represents a 25.77 per cent year-on-year growth.
The 10 highest-earning states accounted for N2.16 trillion of the total, representing 47.47 per cent of all net FAAC disbursements to states during the period, compared with 48.16 per cent in the first half of 2025.
Other states in the top 10 were Kano, which received N152.57 billion; Oyo, N139.09 billion; Ondo, N113.04 billion; Jigawa, N111.61 billion; and Borno, N109.65 billion.
The figures underline the changing dynamics of Nigeria’s revenue-sharing system, with states possessing large commercial and consumption bases increasingly benefiting from VAT, while oil-producing states continue to rely heavily on derivation revenues.
Lagos’ performance, in particular, highlights the growing importance of economic scale, formal business activity and consumer spending in determining states’ share of federally collected revenue.
With additional information from Nairametrics
