NBS: FG’s revenue from company income tax tripled to N1.53trn in Q2 2023

The federal government’s revenue from company income tax (CIT) more than tripled to N1.53 trillion in the second quarter (Q2) of 2023.

Data culled from the National Bureau of Statistics CIT report on Monday, show that the value is 226.40 percent higher than the N469 billion the government rake in Q1 2023.

The CIT — one of the government’s revenue-generating channels — is a tax on the profits of registered companies in Nigeria. It also includes the tax on the profits of foreign firms operating in the country.

Currently, the tax is charged at the rate of 30 percent for companies with more than N100 million in turnover, and 20 percent for companies with a turnover ranging between N25 million and N100 million.

LOCAL VS FOREIGN COMPANIES

According to the NBS report, CIT payments from local companies totalled N1.03 trillion, while foreign firms contributed N505.91 billion in the quarter under review.

“On the aggregate, Company Income Tax (CIT) for Q2 2023 was reported at N1.53 trillion, indicating a growth rate of 226.40% on a quarter-on-quarter basis from N469.01 billion in Q1 2023,” the report reads.

“Local payments received were N1.02 trillion, while Foreign CIT Payment contributed N505.91 billion in Q2 2023.

“On a quarter-on-quarter basis, water supply, sewerage, waste management, and remediation activities recorded the highest growth rate with 626.52%, followed by accommodation and food service activities with 585.11%.

“On the other hand, education had the lowest growth rate with – 15.48%, followed by public administration and defence, compulsory social security with 25.46%.”

MANUFACTURING, FINANCIAL ACTIVITIES MAJOR CONTRIBUTORS IN Q2

In terms of sectoral contributions, the top three largest shares in Q2 2023 were manufacturing (25.63 percent); financial and insurance activities (24.47 percent); and the information and communication sector (20.30 percent).

However, the report explained that the activities of households as employers, undifferentiated goods- and services-producing activities of households for own use recorded the least share at 0.01 percent, followed by activities of extraterritorial organisations and bodies at 0.06 percent; and water supply, sewerage, waste management, and remediation activities with 0.09 percent.

In addition, on a year-on-year basis, the CIT collections in Q2 2023 increased by 114.28 percent from Q2 2022, the NBS said.