NBS: Company income tax increased by 150.83% to N2.47trn in Q2 2024

The National Bureau of Statistics (NBS) says the federal government generated a total of N2.47 trillion, from company income tax (CIT) in the second quarter (Q2) of 2024.

The NBS, in its Q2 CIT report published on Monday, said the amount increased by 150.83 percent from earnings in the first quarter (Q1).

The CIT is a tax on the profits of incorporated entities in Nigeria. It also includes the tax on the profits of non-resident companies operating a business in Nigeria.

In Nigeria, the CIT is charged at 30 percent for companies with more than N100 million in turnover — and 20 percent for companies with a turnover between N25 million and N100 million.

“On the aggregate, Company Income Tax (CIT) for Q2 2024 was reported at N2.47 trillion, indicating a growth rate of 150.83% on a quarter-on-quarter basis from N984.61 billion in Q1 2024,” the bureau said.

“Local payments received were N1.35 trillion, while Foreign CIT Payment contributed N1.12 trillion in Q2 2024.” 

A sectoral analysis of the revenue on a quarterly basis showed that agriculture, forestry and fishing recorded the highest growth rate at 474.5 percent, followed by financial and insurance activities (429.76 percent) and manufacturing (414.15 percent).

“On the other hand, activities of households as employers, undifferentiated goods- and services-producing activities of households for own use had the lowest growth rate with -30.22% followed by activities of extraterritorial organizations and bodies with -15.67%,” the bureau said.

“In terms of sectoral contributions, the top three largest shares in Q2 2024 were Financial and insurance activities with 15.53%; manufacturing with 8.99%; and Information and communication with 7.84%.

“Nevertheless, the activities of households as employers, undifferentiated goods- and services-producing activities of households for own use recorded the least share with 0.00%, followed by water supply, sewerage, waste management, and remediation activities with 0.02% and activities of extraterritorial organizations and bodies with 0.03%.”

On a year-on-year basis, the NBS said CIT collections in the period examined increased by 59.52 percent from N1.55 trillion recorded in Q2 2023.

On June 4, Taiwo Oyedele, chairman of the presidential fiscal policy and tax reforms, said the committee proposed a reduction of the company income tax by 5 percent.

He said the tax rate should drop from 30 percent to 25 percent to encourage businesses and investors.