The Federal Government has officially commenced the process of reviewing Nigeria’s revenue allocation formula to meet current realities.
Chairman of the Revenue Mobilisation Allocation and Fiscal Commission (RMAFC), Mohammed Bello Shehu who announced the commencement of the review process at a press conference in Abuja on Monday says The commission will come up with recommendations on revenue sharing formula by the end December 2025.
The last review of the Revenue Allocation Formula was carried out in 1992; however, there were several executive orders from May 2002 to date to modify the formula to reflect emerging socioeconmic realities.
Under the current formula, the Federal Government gets 52.68 per cent, the 36 states get 26.72 per cent, while the 774 local government areas in the country share 20.60 per cent every month.
The proposed formula, therefore, suggest an upward review for states and local governments, but a downward review for the federal government
Some Stakeholders present at the briefing urged the government to push more resources to the sub-national, especially for infrastructure and electricity projects across the state.
The Federal Government is already relinquishing 5% of its tax revenue to the states as contained in the recently signed national tax laws.
The Commission restated its commitment to integrating cutting-edge research, empirical data, and international practices in its analysis.
(Editor: Paul Akhagbemhe)
