Nigeria’s public finances are undergoing a notable shift, with income from non-oil sources now forming the bulk of federally collected revenue, according to a March 2026 assessment by Quartus Economics.

The report indicates that about three-quarters of funds shared across the federation are now derived from non-oil streams, signalling a departure from more than a decade of heavy reliance on crude oil earnings.
A key driver of this change is taxation.

The analysis shows that taxes account for roughly 87 per cent of federal receipts, while oil income has fallen to about 27 per cent of the total.

This marks a sharp contrast to the early 2010s, when crude sales provided nearly three-quarters of government revenue and left the country exposed to swings in global oil prices.

That vulnerability became evident after the 2014 collapse in oil prices, which pushed the economy into a prolonged slowdown. Average GDP growth, which stood above six per cent between 2010 and 2014, dropped to just over one per cent in the years that followed.
Over the same period, income per person declined significantly.

According to the report, recent tax reforms, tighter revenue administration and policy adjustments have strengthened collections outside the petroleum sector. Measures such as the increase in Value Added Tax from five to 7.5 per cent and the centralisation of oil and gas proceeds under Executive Order 9 have improved remittances, including a notable rise in royalty payments earlier this year.

The researchers say the expanding non-oil base reduces the government’s exposure to commodity price shocks and provides a steadier platform for funding public services and investments at federal, state and local levels.

Despite the progress, the report also draws attention to the country’s rising debt profile. Public debt, which was about 12.5 per cent of GDP in 2014, has climbed to nearly 39 per cent a decade later. While still considered manageable, the trend underscores the need for continued caution as authorities work to consolidate recent gains in revenue diversification.

Overall, the findings point to a gradual restructuring of Nigeria’s fiscal framework, where dependence on crude oil is giving way to a broader and more sustainable revenue mix.