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These Are Nigeria’s Richest States (by Internally Generated Revenue)

Nigeria’s official custodian of public data, the National Bureau of Statistics (NBS), recently published its annual report on the revenues generated by the country’s states. The document, available on the bureau’s website, details the earnings collected by state governments in 2018.

Besides stoking the old debate about which regions produce the most wealth, the NBS’s report highlights a number of other popular talking points: states’ debt levels, their dependence on aid from the Federal Government, and the perennial battle within public institutions to keep their books balanced.

Still, the discussion tends to tilt in the direction of bragging rights, even among the experts. It seems there’s satisfaction derivable from seeing the state one calls home sitting pretty at the top of a list like this one. Digging beyond the headline figures may dampen that pride; but excavating that deep isn’t the average Joe’s cup of tea.

This article does tow the popular line somewhat- we’re ranking the richest states by Internally Generated Revenue, as suggested by the NBS’s data. But it also gets past the veneer of big figures, and shows where some of that money comes from, and whether it’s really worth the raised shoulders in the first place.

The States Raking In the Most Revenue

Here’s a list of Nigerian states which brought in the most revenue in 2018, in descending order of amounts collected.

1. Lagos

Lagos is Nigeria’s richest state; that’s not contestable. What isn’t always clear to us regular people is how much it contributes to the country’s economy. We can still guess that it’s a lot.

The NBS’s report says that Lagos generated ₦382.18 billion last year. That’s about one third of the combined revenue generated within each state. Most of this came from taxes- especially Pay-as-You-Earn (PAYE) which comes from businesses operating in the state. This indicates something that’s already common knowledge: Lagos is sustained by private sector commerce.

On the downside, the state also leads the way in debt levels, with its external debt alone standing at $1.4 billion. Throw in what it owes locally, and you have a debt that exceeds its total earnings from all sources.

2. Rivers

This oil-rich state benefits immensely from taxes paid by the large multinational oil firms doing business on its territory. While its ₦112.78 billion IGR is only a fraction of what Lagos has managed in the past few years, it’s enough to hoist this state into second place.

Half of what was collected by the Rivers State Government came from PAYE taxes derived from businesses. A large chunk also came from the government’s Ministries, Departments and Agencies.

It’s fair to say that Rivers could do better if its economy was more diversified. The same can be said for other oil producing states on this list. And there are a number of them here.

3. Ogun

Ogun, which sits just to the north of Lagos, has positioned itself as a relatively inexpensive base for manufacturers seeking access to the huge consumer market that is Lagos. They have benefitted a great deal from this strategy. Companies have settled down there, paid taxes, and made the state richer.

In 2018, Ogun brought in ₦84.5 billion in revenues, more than oil producing states like Delta, Edo, Ondo and Akwa Ibom could manage. Of that amount, ₦52.9 billion were from taxes. Activity on its roads sent ₦1.65 billion into the state’s coffers in the period under consideration.

4. Delta

Another state which largely owes its presence on this list to the taxes it collects from the oil industry. Last year, it took in ₦58.4 billion, with about ₦42 billion coming from PAYE. Of course, there’s more going on in Delta State than just piping out crude. But the petroleum sector remains its cash cow.

5. Kano

Northern Nigeria’s chief commercial center and the country’s second most populous state. For its strengths, Kano mustered ₦44.11 billion from various sources last year. This marked a 4% increase in collections from 2017.

The public sector contributed a large amount to this final figure- about ₦11.83 billion. However, this was lower than the ₦15.23 billion it managed two years ago. The fact that total revenues went up (in spite of the decline in the public sector’s share) indicates a strengthening of private business concerns, a stricter implementation of tax rules, or both.

6. Kaduna

The second Northern State on this list, Kaduna realized ₦29.45 billion from various internal sources in the period under review. It’s the first of about half a dozen states which reported receiving ₦20-30 billion in 2018. Of the figure announced, ₦14 billion was derived from PAYE taxes and ₦12 billion from Ministries, Departments and Agencies of the state government.

7. Edo

Edo’s ₦28.43 billion revenue places it eight on this list.

While that’s a lot of money considered on its own, Edo does rely on the Federal Government to top up what it generates so the state is able to take care of its local needs. It got an additional ₦69.16 billion from the government at the center in Federal Accounts Allocation Committee (FAAC) contributions last year, more than twice what it gets from its IGR. This is true for many other states on the NBS’s list as well.

8. Ondo

The NBS says Ondo generated ₦24.79 billion in revenues last year, more than double what it did in 2017. This shot it up from its prior position closer to the bottom of the rankings and put it among the country’s top ten states by moneys remitted into government acounts.

Here’s a sobering thought though: Ondo still depends quite heavily on the Federal Government to keep going. In 2018, it augmented its IGR with ₦64.68 billion in FAAC allocations, more than two times what it was able to generate on its own.

9. Oyo

Oyo comes ninth in this year’s states’ ‘rich list’.  That’s because it pulled in ₦24.64 billion from sources located within its boundaries or directly connected with it.  ₦20 billion was realized through taxes, and ₦4.4 billion came in from the public sector.

10. Akwa Ibom

Akwa Ibom rounds off the list of top ten revenue generating states from 2018, with an IGR of ₦24.21 billion. ₦22 billion was obtained through taxation on companies, self-employed individuals, roads, levies on property, etc.

The FAAC allocation received by Akwa Ibom State in the past year was more than eight times what the state generated internally. We may temper this eye popping difference by adding that much of what’s distributed under the FAAC is actually oil revenues originating from places like Akwa Ibom. But it’s still a huge gap.

A Couple of Extra Facts

The three poorest states in terms of IGR were Yobe (₦4.38 billion), Kebbi (₦4.88 billion), and Taraba (₦5.97 billion).

The total IGR produced by all the states of the federation (including the FCT) was ₦1.168 trillion.

Featured image source: Daily Post Nigeria

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Ikenna Nwachukwu

Ikenna Nwachukwu holds a bachelor's degree in Economics from the University of Nigeria, Nsukka. He loves to look at the world through multiple lenses- economic, political, religious and philosophical- and to write about what he observes in a witty, yet reflective style.

1 Comment

1 Comment

  1. Avatar

    Elagha Isaac

    23rd May 2019 at 11:20 am

    Mydelta is there.
    But what about bayelsa state.

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