Which states are the top highest revenue generating states in Nigeria? The impact of internally generated revenue (IGR) on economic growth cannot be overemphasized. The inability of some states in Nigeria to generate enough IGR is a major setback for a developing country like Nigeria as these states cannot stand alone and take care of their various expenditures without the support of the federal government through monthly allocations.
These states include the states of insurgencies that generate little to no amount of IGR due to the state of insecurity in the states. However, few states generate enough IGR that can cater to their various expenditures and do not have to depend solely on federal monthly allocations.
The top 10 highest revenue-generating states in Nigeria as of [currentyear] are listed below with Lagos State leading the chart and Nassarawa making the number 10 on the list.
Top 10 Highest Revenue Generating States In Nigeria
1. Lagos State
Being currently governed by Mr. Babajide Sanwo-Olu is the most populated state with over 9 million inhabitants and generates the highest IGR recorded in the first half of the year with over 18,000 naira per population (over 26% increase compared to the 14,851 and 14,337 naira made in 2019 and 2020 respectively) sourced majorly from tax collected from Citizens such as salary earners, business owners, investments, transportation, and the likes. With this IGR, Lagos state can be a small country on its own.
Ranked second with over 3 million inhabitants, Abuja made 12,173 naira per population in the first half of the year compared to 8,187 and 6,809 naira generated in the year 2019 and 2020 respectively. Tax is one of the major sources of revenue if not the highest.
3. Ogun State
Having Mr. Dapo Abiodun as its sitting governor with over 6 million inhabitants followed closely behind Abuja is Ogun state with an IGR of 8,908 naira per population which is a huge amount compared to the 5,135 and 3,978 naira made in the year 2019 and 2020 respectively.
Its major source of income is from tax and business holders coupled with the few sourced from tourism, natural resources, and monies generated from markets.
4. Rivers State
Rivers state which is a major oil-producing state and largest producer of petroleum in Nigeria with Mr. Ezenwo Nyesom Wike as its current governor and over 9 million inhabitants generated 6,621 naira per population which is a huge decrease compared to 9,393 and 7,718 recorded in the year 2019 and 2021 respectively.
From this analysis, it is obvious that Rivers state is recording a continuous decline from the year 2019 and falls 2 steps below its rating which is second in position the previous year. The major source of IGR is crude oil.
5. Delta State
One of the top oil-producing states in Nigeria made the fifth position having a population of over 4 million with Dr. Ifeanyi Arthur Okowa as its current governor generating 6,310 naira per population in the first half of the year compared to 5,837 and 4,792 naira made in the year 2019 and 2021 respectively.
Crude Oil is one of the major sources of income, tourism and agriculture also contributed to the generation of revenue.
6. Kwara State
Led by Mr. AbdulRahman AbdulRazaq with over 2 million inhabitants, Kwara state generated 4,307 naira compared to 4,606 and 2,600 naira, recorded in the year 2019 and 2020 respectively.
The major source of revenue is tax, social contributions with few generated from sales by the government (for example, users’ fees for the provision of services, grants, property income, and the likes.
7. Edo State
Having Mr. Godwin Nogheghase Obaseki as its current Governor and an estimated population of over 3 million inhabitants generated 3,640 naira per population compared to 3,362 and 2,970 naira in the year 2019 and 2020 respectively.
Their major source of wealth is tourism and Edo is also an oil-producing state, therefore, crude oil is also a source of internally generated revenue.
8. Cross Rivers State
Cross Rivers is the only state around its region that does not produce crude oil, with a population of over 2 million inhabitants and currently under the rule of Governor Benedict Ayade generated 3,302 naira per population compared to the 3,967 and 1,854 reported in the year 2019 and 2020 respectively. Its source of revenue is tourism, agriculture, and tax.
9. Ondo State
Ondo state is also one of the oil-producing states in Nigeria, having a population not up to 500,000 inhabitants, with Mr. Oluwarotimi Odunayo Akeredolu (SAN) as its sitting Governor making it to the top 10 highest revenue-generating states and generating 3,299 naira for the first half of the year 2021 compared to 3,717 and 2,579 naira generated in the year 2019 and 2020 respectively.
Its major source of income is agriculture (Ondo is one of the major cocoa producing states), crude oils, charges on forest trades (inter-State wood transportation charges), and the likes.
10. Nassarawa State
Nassarawa is the only northern state that made it to the top 10 highest revenue-generating states in Nigeria with a population of almost 2 million inhabitants under the government of Alhaji Abdullahi Sule. The state generated 3,242 naira per population for the first half of the year higher than the 1,754 and 2,074 naira generated in the year 2019 and 2021 respectively.
From the records, there seems to be a continuous increase in the revenue generated by this state in the subsequent years. The major source of revenue is agriculture.
From the records generated so far, it is obvious that the pandemic outbreak in the year 2020 has a major effect (negatively) on the internally generated revenue of most of the states as a decline was recorded in the IGR generated in that year except for Nassarawa state which increased during the pandemic compared to the previous year.
Comparing the revenue generated by the states to the expenditures, it’s only Lagos State that can boastfully stand on its own without the federal government allocation. The other states still depend on the allocation for sustainability to a certain extent.
Out of the 36 states in Nigeria, not up to 3 are generating enough revenue to tackle their various expenditures such as infrastructures, that is why some of these states owe workers’ salaries.
It is okay to say that this inability to generate enough revenue might be partly due to corruption, which indirectly hinders the growth of the country, that is why Nigeria is still underdeveloped to date.