FAAC holds its August meeting in Owerri, discusses Nigeria’s fitness path

The Federation Account Allocation Committee (FAAC) convened its August 2026 meeting in Owerri, the Imo State capital, on the margins of the ongoing National Council of Federation and Economic Development (NACOFED) – pairing the Committee’s routine monthly business with a broader push to strengthen fiscal fundamentals across Nigeria’s federating units.

Beyond approving the sharing of July 2026 revenue, the gathering was used to chart a path for states to convert Nigeria’s recent revenue growth into lasting fiscal strength, headlined by a dedicated retreat session for Commissioners of Finance and Accountant-General on subnational fiscal fitness.

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The FAAC session discussed state of the economy, fiscal governance, and federal and subnational fiscal fitness. The session set out the scale of the recent revenue windfall and called for deliberate reform to convert it into durable fiscal strength rather than a temporary gain.

The meeting noted that gross FAAC have risen significantly over the past three years driven by subsidy removal, exchange-rate unification and tax reform.

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The session highlighted the impact of the Nigeria Tax Act 2025, effective 1 January 2026: states’ share of VAT revenue rises from 50% to 55% (the Federal Government’s falls from 15% to 10%), while 30% of the states’ VAT pool is now allocated by place of consumption rather than a company’s registered headquarters – directly linking a state’s own economic activity to the size of its federation allocation.

* Revenue quality – diversifying own-source income beyond a narrow tax base.
* Asset strength – inventorying and putting idle state-owned assets to productive use.

* Growth engine – measuring and expanding the state and national economy, including through official state GDP data.

* Capital attraction – a stable, predictable business environment and structured investor engagement.
* Human capital – sustained investment in education and health as the foundation of future development.
* Institutional plumbing – timely, audited and transparent public accounts.All tiers of government were encouraged to use the current period of strong revenue growth to institutionalise reforms including comprehensive asset registers, payroll verification, and timely publication of audited accounts over the next twelve months.

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