Section 162 to 168 of the Nigerian Constitution 1999
Section 162 to 168 of the Nigerian Constitution is under C (Public Revenue) of Part I (Federal Executive) of Chapter VI (The Executive) of the constitution.
Section 162 of the Nigerian Constitution 1999
Distributable pool account
(1) The Federation shall maintain a special account to be called “the Federation Account” into which shall be
paid all revenues collected by the Government of the Federation, except the proceeds from the personal income tax
of the personnel of the armed forces of the Federation, the Nigeria Police Force, the Ministry or department of
government charged with responsibility for Foreign Affairs and the residents of the Federal Capital Territory, Abuja.
(2) The President, upon the receipt of advice from the Revenue Mobilisation Allocation and Fiscal Commission,
shall table before the National Assembly proposals for revenue allocation from the Federation Account, and in
determining the formula, the National Assembly shall take into account, the allocation principles especially those of
population, equality of States, internal revenue generation, land mass, terrain as well as population density;
Provided that the principle of derivation shall be constantly reflected in any approved formula as being not less than
thirteen per cent of the revenue accruing to the Federation Account directly from any natural resources.
(3) Any amount standing to the credit of the Federation Account shall be distributed among the Federal and State
Governments and the Local Government Councils in each State on such terms and in such manner as may be
prescribed by the National Assembly.
(4) Any amount standing to the credit of the States in the Federation Account shall be distributed among the States
on such terms and in such manner as may be prescribed by the National Assembly.
(5) The amount standing to the credit of Local Government Councils in the Federation Account shall also be
allocated to the State for the benefit of their Local Government Councils on such terms and in such manner as may
be prescribed by the National Assembly.
(6) Each State shall maintain a special account to be called “State Joint Local Government Account” into which
shall be paid all allocations to the Local Government Councils of the State from the Federation Account and from
the Government of the State.
(7) Each State shall pay to Local Government Councils in its area of jurisdiction such proportion of its total revenue
on such terms and in such manner as may be prescribed by the National Assembly.
(8) The amount standing to the credit of Local Government Councils of a State shall be distributed among the Local
Government Councils of that State on such terms and in such manner as may be prescribed by the House of
Assembly of the State.
(9) Any amount standing to the credit of the judiciary in the Federation Account shall be paid directly to the
National Judicial Councils for disbursement to the heads of courts established for the Federation and the States
under section 6 of this Constitution.
(10) For the purpose of subsection (1) of this section, “revenue” means any income or return accruing to or derived
by the Government of the Federation from any source and includes –
(a) any receipt, however described, arising from the operation of any law;
(b) any return, however described, arising from or in respect of any property held by the Government of the
Federation;
(c) any return by way of interest on loans and dividends in respect of shares or interest held by the Government of
the Federation in any company or statutory body.
Section 163 of the Nigerian Constitution 1999
Allocation of other revenues
Where under an Act of the National Assembly, tax or duty is imposed in respect of any of the matters specified
in item D of Part II of the Second Schedule to this Constitution, the net proceeds of such tax or duty shall be
distributed among the States on the basis of derivation and accordingly –
(a) where such tax or duty is collected by the Government of a State or other authority of the State, the net proceeds
shall be treated as part of the Consolidated Revenue Fund of that State;
(b) where such tax or duty is collected by the Government of the Federation or other authority of the Federation,
there shall be paid to each State at such times as the National Assembly may prescribe a sum equal to the proportion
of the net proceeds of such tax or duty that are derived from that State.
Section 164 of the Nigerian Constitution 1999
Federal grants-in-aid of State revenue.
(1) The Federation may make grants to a State to supplement the revenue of that State in such sum and subject
to such terms and conditions as may be prescribed by the National Assembly.
(2) The Federation may make external grants to a foreign State or any international body in furtherance of the
foreign policy objectives of Nigeria in such sum and subject to such terms and conditions as may be prescribed by
the National Assembly.
Section 165 of the Nigerian Constitution 1999
Cost of collection of certain duties
Each State shall, in respect of each financial year, pay to the Federation an amount equal to such part of the
expenditure incurred by the Federation during that financial year for the purpose of collection of taxes or duties
which are wholly or partly payable to the State pursuant to the provisions of this Part of this Chapter or of any Act of
the National Assembly as is proportionate to the share of the proceeds of those taxes or duties received by the State
in respect of that financial year.
Section 166 of the Nigerian Constitution 1999
Set-off
(1) Any payment that is required by this Part of this Chapter to be made by the Federation to a State may be setoff by the Federation in or towards payment of any sum that is due from that State to the Federation in respect of any
loan made by the Federation to that State.
(2) The right of set-off conferred by subsection (1) of this section shall be without prejudice to any other right of the
Federation to obtain payment of any sum due to the Federation in respect of any loan.
Section 167 of the Nigerian Constitution 1999
Sums charged on consolidated Revenue Fund
Any payment that is required by this Part of this Chapter to be made by the Federation to a State shall be a
charge upon the Consolidated Revenue Fund of the Federation and any payment that is so required to be made by a
State to the Federation shall be a charge upon the Consolidated Revenue Fund of that State.
Section 168 of the Nigerian Constitution 1999
Provisions with regard to payments
(1) Where any payment falls to be made under this Part of this Chapter, the amount payable shall be certified
by the Auditor-General for the Federation;
Provided that a provisional payment may be made before the Auditor-General has given his certificate.
(2) The National Assembly may prescribe the time at and manner in which any payment falling to be made under
this Part of this Chapter shall be effected and provide for the making of adjustments and provisional payment.
