Lagos Surpasses Oil States in H1 2026 FAAC Allocations

In the first half of 2026, Lagos State emerged as Nigeria’s highest recipient of Federation Account allocations, collecting N365.78 billion, surpassing oil-rich states such as Delta, Rivers, Akwa Ibom, and Bayelsa. This development reflects the increasing significance of Value Added Tax (VAT) and commercial activity in state revenue generation.

The Federation Account Allocation Committee (FAAC) reported that the 36 states collectively received N4.54 trillion, a 25.77% increase from N3.61 trillion in H1 2025. Lagos's allocation rose by 54.39% from N236.92 billion, primarily driven by VAT, which accounted for N344.06 billion of its total.

Delta State, previously the top recipient, fell to second with N331.43 billion, while Rivers, Akwa Ibom, and Bayelsa followed in third, fourth, and fifth positions, respectively. Analysts noted that while oil-producing states benefit from derivation payments, states with strong commercial bases like Lagos are increasingly closing the revenue gap.

The June 2026 FAAC meeting distributed about N2.55 trillion among the three tiers of government.