By Ayo Kehinde
Nigeria’s Value Added Tax (VAT) disbursement to states climbed sharply in February 2026, with gross allocations rising by 30.36 percent month-on-month to ₦551.77 billion from ₦423.25 billion recorded in January.
Data from the Office of the Accountant General shows that net VAT disbursement also increased by 31.41 percent to ₦541.89 billion, reflecting sustained revenue momentum across subnational governments in the first quarter of the year.
The increase was broad-based, with all states recording higher allocations during the month, pointing to steady tax collection and resilient economic activity. The February growth builds on a strong rebound in January, when VAT disbursements surged by 74 percent, suggesting that the earlier spike was not a one-off adjustment.
Lagos State retained its position as the largest recipient by a wide margin, with gross allocation rising to ₦111.22 billion from ₦61.00 billion in January, an 82.32 percent increase. After a deduction of ₦9.89 billion, its net disbursement stood at ₦101.34 billion, highlighting its dominance as Nigeria’s top VAT contributor.
Oyo State ranked second with ₦24.04 billion, followed by Rivers at ₦23.57 billion and Kano at ₦17.37 billion. The Federal Capital Territory entered the top tier with ₦15.76 billion, while Bayelsa posted a strong increase to ₦15.07 billion.
Mid-tier states such as Katsina, Jigawa, Delta, and Kaduna recorded moderate gains, while lower-ranked states also saw steady increases, with allocations generally ranging between ₦9 billion and ₦10.5 billion.
The sustained rise in VAT distribution underscores improving fiscal inflows to states, even as disparities in economic activity continue to shape allocation patterns.
