Consumers question impact of increased federal allocations while many feel rising taxes on everyday purchases

The Federation Account Allocation Committee (FAAC) has distributed a record ₦2.3 trillion among the Federal Government, state governments and local government councils for May 2026, prompting fresh debate among citizens in Lagos and across Nigeria over how these funds are being used. The disbursement, which represents an increase from the ₦2.26 trillion shared in April, was announced by FAAC in Abuja on Tuesday.

According to the committee’s communiqué, the revenue comprised ₦1.611 trillion from statutory sources and ₦688.8 billion generated through Value Added Tax (VAT). Gross revenue for the month reached ₦3.395 trillion, with ₦123.5 billion deducted as collection costs and ₦971.6 billion earmarked for transfers, interventions and refunds.

Despite the higher allocation, many Nigerians took to social media to express frustration over what they described as a lack of visible improvement in infrastructure, healthcare or public welfare at the grassroots level. One Lagos-based consumer shared that he paid over ₦300,000 in VAT alone when buying electronic appliances recently, using his experience to highlight concerns about the burden of Nigeria’s 7.5% VAT on basic goods.

FAAC disclosed that while statutory revenue increased significantly in May to ₦2.651 trillion from ₦2.378 trillion in April, VAT earnings actually dropped from ₦806.6 billion to ₦743.7 billion within the same period. The committee also noted that collections from Companies Income Tax (CIT), Capital Gains Tax (CGT), Stamp Duties, Petroleum Profit Tax (PPT), Hydrocarbon Tax and Oil and Gas Royalties all saw notable increases during the month, but Import Duty, Excise Duty and CET Levies declined.

From the latest allocation, the Federal Government received ₦818.7 billion; states got ₦759.1 billion; local government councils received ₦534.3 billion; while oil-producing states were given an additional ₦188.1 billion under the 13% derivation formula.

Reactions online captured a growing sense of disillusionment among ordinary Nigerians regarding how public resources are managed and spent at all levels of government. One user wrote: “₦2.3 trillion was shared in one month and ordinary Nigerians are still asking where the impact is.” Others called for greater accountability not only from federal authorities but also from state and local governments responsible for delivering essential services.

As at press time, government officials had yet to respond directly to these concerns but have previously stated that revenue allocations are meant to fund ongoing projects and address fiscal challenges across sectors including education, health and security.

Source: https://www.pulse.ng/story/i-paid-over-naira300000-vat-alone-on-electronics-nigerian-man-reacts-as-faac-shares-naira23-trillion-may-revenue-2026061810251080302