World Bank: Lagos and Enugu Lead in Revenue Generation

The World Bank's October 2026 Nigeria Development Update revealed that only Lagos and Enugu states generated enough internally generated revenue (IGR) to cover their recurrent expenditures in 2025. While states improved their revenue collection, the average IGR covered only about 40% of recurrent spending from 2021 to 2023, increasing to approximately 50% in 2024 and 2025.

Specifically, Lagos generated revenue equivalent to 160% of its recurrent spending, while Enugu achieved a remarkable 377%. Enugu's IGR grew from N25 billion to N209 billion, marking a 732% increase, largely due to enhanced tax administration and digital technology initiatives.

The Direct Assessment Tax personal income tax saw a significant rise from N280 million to N14.5 billion, nearly 4,000% growth. The report emphasized that most states face fiscal risks if federally collected revenues decline, despite improvements in tax compliance and revenue collection efficiency.