The current sources of revenue flow into the Federation Account are collected by agencies of the Federal Government with little or no contributions from state or local government council. While the Federal Government and its agencies under the administration of President Muhammadu Buhari received a total sum of N3.48 trillion, States and local government councils shared a total sum of N4.5 trillion in 2018. Comparatively, in 2017 the Federal Government and its agencies had received N2.5 trillion, while the other tiers of government shared N3.3 trillion.
In its annual detailed investigative report with a table of figures, the Economic Confidential disclosed that among the state recipients, Delta is ranked first as the highest recipient of gross allocation with a total sum of N285bn in the twelve months of 2018.
It is followed by Akwa State N272bn, Lagos N260bn, Rivers N237bn and Bayelsa N192bn. The five states cumulatively, cornered over a quarter (25%) of the total allocation for the States and local government councils in Nigeria in 2018. Among the 10 highest recipients from the Federation Account in 2018 included:
Kano State which got N183bn, Katsina N138bn, Oyo N131bn, Kaduna N131bn and Borno State N122bn. The report further disclosed that Edo and Ondo which are oil-producing states got N112bn and N108bn respectively, while another state in the South-South, Cross River State merely received N91bnbn.
Nigeria’s intelligence economic magazine further, informed that factors that influence allocations to states and local government councils from the Federation Account include:
Population, Derivation, Landmass, Terrain, Revenue Effort, School Enrolments, Health Facilities, Water Supply and Equality of the beneficiaries. The revenue generating agencies to the Federation Account are the Nigerian National Petroleum Corporation (NNPC), Federal Inland Revenue Service (FIRS), Nigeria Customs Service (NCS) and Department of Petroleum Resources (DPR).
The revenues come from Export Crude Sales, Domestic Crude Sales, LPG, NLNG, Petroleum Profit Tax (PPT), Company Income Tax (CIT), Withholding Tax (WHT), Import Duty, Excise Duty, Royalties, Gas Flared and miscellaneous oil revenue such as Oil Prospecting License and oil Mining Licence.