Abia State generated just 1.9% of the South-East’s VAT revenue but took home 18.6% of the total the region received

Key Takeaways

  • The South-East remitted ₦10.94 billion in VAT but received ₦39.15 billion, a 257.7% increase, showing a high reliance on VAT sharing.
  • Abia, the lowest contributor (₦734M), received ₦7.29B, nearly 10× its remittance, making it the biggest relative beneficiary in the region.
  • Anambra, the highest contributor (₦3.56B), received only ₦8.72B, showing a sharing trend where high-contributing states do not necessarily receive the most.
  • Every South-East state received at least 2× what they remitted, with an average allocation of ₦7.83B despite an average contribution of just ₦2.19B.

The VAT remittance vs. sharing in the South-East geopolitical zone of Nigeria reveals a system where some states receive significantly more than they generate. The region remitted ₦10.94 billion in VAT but received ₦39.15 billion, meaning it got back ₦3.58 for every ₦1 contributed—one of the highest sharing ratios in Nigeria.

A striking disparity is seen in Abia, which remitted the least (₦0.73 billion) yet received ₦7.29 billion, nearly 10× its remittance, making it the biggest relative gainer in the South-East.

Conversely, Anambra, the highest contributor (₦3.56 billion), received ₦8.72 billion, reflecting a sharing model where revenue generation does not directly determine allocation.

Similarly, Imo and Enugu, which remitted ₦1.59 billion and ₦1.75 billion respectively, received ₦8.26 billion and ₦7.76 billion, further emphasising how VAT allocation prioritises equalisation over economic output. Despite varying contributions, every South-Eastern state received at least double its VAT remittance, with the region’s average allocation per state standing at ₦7.83 billion, compared to an average remittance of just ₦2.19 billion.

Source:

Federal account allocation committee (FAAC)

Period:

January 2025
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