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Nigeria subnational revenue and debt trends

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2026-10-11 01:48 UTC → 2026-10-12 16:29 UTC · added ~~removed~~

In 2025, Nigeria’s 36 states and the Federal Capital Territory (FCT) generated N5.15 trillion in internally generated revenue (IGR), a 40.93 percent increase from 2024. Tax revenue accounted for N3.79 trillion, with Pay As You Earn (PAYE) tax serving as the primary driver. Lagos State remained a leading contributor, generating N1.77 trillion. While aggregate state IGR grew by 55 percent between 2023 and 2025 due to improved tax administration and digital automation, most states remain heavily dependent on federal allocations. A World Bank report indicates that on average, state IGR covered only about 50 percent of recurrent spending in 2024 and 2025. Only Lagos and Enugu states generated enough IGR to cover their recurrent expenditures in 2025. Notably, Enugu recorded a significant increase in IGR, growing from N25 billion to N209 billion, representing a 732 percent increase in real terms, with a ratio of 377 percent of its recurrent spending. Fiscal challenges persist as at least 30 states and the FCT reported domestic debt stocks exceeding 50 percent of their annual IGR. Road tax revenue, defined as daily levies from commercial transporters, totaled N113.94 billion between 2023 and 2025. Lagos contributed N33.61 billion of this total, or approximately 29.5 percent. Outside of Lagos, Delta State recorded the highest collections at N8.64 billion, followed by Ondo, Ogun, Edo, and Cross River. Detailed data from the National Bureau of Statistics (NBS) shows that PAYE taxes specifically reached N2.64 trillion in 2025, a 40.3 percent increase from N1.88 trillion in 2024. This PAYE collection accounted for 69.5 percent of the N3.79 trillion in total state and FCT tax revenue. This growth is attributed to salary adjustments and the implementation of a N70,000 minimum wage.

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