Amid ongoing debates over the proposed tax reform bills by the current administration, the Federal Government and 21 states in Nigeria have collectively projected a Value Added Tax revenue of N2.53 trillion for 2025 in their budget estimates.
This figure excludes additional revenue that could be generated from the implementation of the controversial tax reforms.
VAT, a consumption tax levied on goods and services at each stage of the supply chain, has seen a significant rise in collection. According to reports by the Federation Account Allocation Committee, VAT revenue increased by N549bn under the current administration between October 2023 and March 2024.
A review of the 2025 budget documents from the Federal Government and 21 states shows a combined VAT revenue projection of N2.53tn, marking a 65.8% increase from the N1.527tn estimated for 2024. Budget documents for the remaining 14 states and the Federal Capital Territory were unavailable.
The 21 states included in the analysis are Kebbi, Kaduna, Ekiti, Oyo, Osun, Ogun, Enugu, Borno, Ondo, Kano, Katsina, Ebonyi, Gombe, Anambra, Abia, Niger, Jigawa, Bauchi, Akwa Ibom, Adamawa, and Delta.
The Federal Government’s share of VAT revenue is expected to rise from N512.8bn in 2024 to N972bn in 2025.
Kebbi State, which received N41bn in 2024, projects N87.3bn for 2025.
Kaduna State expects N57.8bn, up from N48.2bn in its 2024 budget.
Ekiti State plans for N54.9bn in VAT revenue, compared to N52.6bn in 2024.
Oyo State, which earned N78.8bn in 2024, has set its 2025 projection at N144bn.
Osun State anticipates N78.1bn, a significant increase from N45.3bn in 2024.
Other notable state projections include:
– Ogun: N85bn (2025) vs. N57.7bn (2024)
– Enugu: N74.9bn (2025) vs. N44bn (2024)
– Borno: N87.3bn (2025) vs. N49.4bn (2024)
– Ondo: N71.5bn (2025) vs. N30.3bn (2024)
– Kano: N97.3bn (2025) vs. N76.6bn (2024)
– Katsina: N85.9bn (2025) vs. N46.9bn (2024)
– Ebonyi: N50.8bn (2025) vs. N36.5bn (2024)
– Gombe: N39bn (2025) vs. N30bn (2024)
– Anambra: N92.4bn (2025) vs. N58.4bn (2024)
Abia, Niger, Jigawa, Bauchi, Akwa Ibom, Adamawa, and Delta states also reported significant increases in their VAT revenue projections for 2025:
– Abia: N60.6bn (2025) vs. N40bn (2024)
– Niger: N64.6bn (2025) vs. N50.6bn (2024)
– Jigawa: N80bn (2025) vs. N45bn (2024)
– Bauchi: N78.5bn (2025) vs. N45bn (2024)
– Akwa Ibom: N70bn (2025) vs. N45bn (2024)
– Adamawa: N52.5bn (2025) vs. N47bn (2024)
– Delta: N46.6bn (2025) vs. N45.7bn (2024)
The projections highlight a broader trend of increasing reliance on VAT revenue by both federal and state governments amid fiscal pressures and ongoing discussions around tax reforms.