Only Lagos and Enugu states raised enough internally generated revenue to cover their recurrent expenditure in 2025, according to figures attributed to the World Bank’s October 2026 Nigeria Development Update.
The report, titled Beyond the Federal Purse: How Higher Revenues Shaped State Priorities, said internally generated revenue covered roughly 40 percent of states’ recurrent costs on average between 2021 and 2023. The proportion improved to approximately 50 percent in 2024 and 2025, but most states remained dependent on federally distributed funds.
Lagos reportedly recorded internally generated revenue equivalent to 160 percent of recurrent spending in 2025, compared with 377 percent for Enugu. The report attributed part of Enugu’s performance to broader taxpayer registration, digital collection systems and efforts to reduce revenue leakage.
It also said aggregate state IGR grew by 55 percent in real terms between 2023 and 2025, while Enugu’s collections rose from N25 billion to N209 billion. The bank warned that states unable to finance basic operating costs from their own resources could face severe disruption if federal receipts decline.
The figures highlight the distinction between higher collections and long term fiscal resilience: stronger tax administration may help, but the durability and fairness of revenue gains remain important questions for state governments.
