Federal Government Receives N2.33 Trillion In VAT And CIT

The federal government collected N2.33 trillion in Value Added Tax (VAT) and Company Income Tax (CIT) in the final three months of 2023, which is less than the N2.73 trillion it collected in the previous quarter, which ran from July to September of the previous year.

The tax income has decreased by 14.7% as compared to the income from the third quarter. Despite the government's VAT revenue growing by 26.61%, there was a 35.4% quarterly depreciation in CIT, which was the source of the depreciation.

The National Bureau of Statistics (NBS) recently published data showing that, in Q4 2023, aggregate VAT was recorded at N1.20 trillion, down from N948.07 billion in Q3 2023.

According to the NBS, in Q4 2023, import VAT contributed N244.04 billion, international VAT payments totaled N326.27 billion, and local payments registered N630.00 billion.

Read: Nigeria's Inflation Rate Increases Once More To 31.7% — NBS

On a quarter-on-quarter basis, agriculture, mining and quarrying recorded the highest growth rate with 63.75 per cent, followed by the other services activities with 61.98 per cent.

However, with a growth rate of -19.44 percent, the operations of extraterritorial organizations and bodies had the lowest growth rate. Financial and insurance sectors followed with growth rates of -8.46 percent.

Manufacturing accounted for 13.24% of sectoral contributions in Q42023, followed by information and communication (10.02%), mining and quarrying (7.91%), and manufacturing (13.24%).

However, the activities of extraterritorial organizations and bodies, water supply, sewerage, waste management, and remediation activities, real estate activities, agriculture, forestry, and fishing, and the production of undifferentiated goods and services by households for their own use recorded the lowest share, at 0.00 percent. Nonetheless, compared to Q4 2022, VAT receipts in Q4 2023 grew by 72.12% annually.

Company Income Tax (CIT) was recorded at N1.13 trillion at the end of the last quarter of 2023, a decrease of 35.40 percent from N1.75 trillion in Q3 2023 on a quarter-over-quarter basis.

In Q4 2023, foreign CIT payments provided N596.10 billion, while local payments received N533.93 billion.

The industries with the greatest growth rates on a quarter-over-quarter basis were construction (57.86%) and electricity, gas, steam, and air conditioning supply (79.65%). Conversely, the public administration and defense, mandatory social security, and information and communication activities had the lowest growth rates, at 69.44 and 23.75, respectively, in comparison.

The top three sectors in terms of sectoral contributions in Q4 2024 were mining and quarrying (5.90%), financial and insurance activities (6.25%), and manufacturing (12.84%). However, household employment, undifferentiated goods- and services-producing activities for personal use, water supply, sewerage, waste management, and remediation activities, and extraterritorial organizations and bodies activities accounted for 0.00, 0.02, and 0.07% of the total.