The National Bureau of Statistics (NBS) reported that Nigeria’s 36 states and the Federal Capital Territory (FCT) collectively generated N5.15 trillion in internally generated revenue (IGR) in 2025, a 40.93% rise from the N3.65 trillion recorded in 2024. This growth was driven by improved tax collections, which accounted for 73.64% of total IGR. Lagos State led with N1.77 trillion, followed by Rivers State at N428.42 billion and Enugu State at N406.77 billion, while Yobe, Ebonyi, and Sokoto recorded the lowest revenues at N16.01 billion, N17.18 billion, and N20.48 billion, respectively, the NBS stated in its 2025 IGR report.
Tax revenue remained the dominant component of IGR, with PAYE (Pay As You Earn) contributing N2.64 trillion—69.51% of total tax collections—and accounting for 51.3% of all IGR. Capital gains tax, the smallest tax category, generated only N12.40 billion. The NBS report also highlighted that IGR included direct assessments, road taxes, stamp duties, withholding taxes, and local government revenues, alongside administrative income from state ministries, departments, and agencies (MDAs) providing public services.
The 40.93% increase in aggregate IGR reflects broader efforts to enhance revenue mobilization across states, though significant disparities persist. While Lagos and Rivers leveraged robust tax systems and economic activity, Yobe and Ebonyi faced challenges in revenue generation, underscoring regional inequalities in fiscal capacity. The NBS noted that these variations could impact states’ ability to fund infrastructure, healthcare, and education, raising questions about equitable resource distribution and governance effectiveness.
The data underscores the critical role of tax administration in Nigeria’s subnational fiscal health. With PAYE dominating revenue streams, states are under pressure to diversify income sources and improve compliance. The NBS findings also highlight the need for targeted interventions to support low-revenue states, ensuring they can meet public service demands amid rising economic challenges.