Nigeria’s Company Income Tax (CIT) has seen a significant decline, dropping to N984.61 billion in the first quarter of 2024, a 12.87% decrease from the N1.13 trillion collected in the last quarter of 2023. This decline highlights the country’s economic challenges, which have forced many businesses to close, exacerbating unemployment and poverty rates.
The National Bureau of Statistics (NBS) reported that local CIT payments were N386.49 billion, while foreign CIT payments contributed N598.13 billion. Sectors such as households as employers and administrative support activities saw substantial growth, while the manufacturing sector and electricity, gas, steam, and air conditioning sectors experienced significant declines.
Conversely, Value Added Tax (VAT) revenues grew by 19.21% quarter-on-quarter, reaching N1.43 trillion in Q1 2024, up from N1.20 trillion in Q4 2023. Local VAT payments amounted to N663.18 billion, foreign VAT payments to N435.73 billion, and import VAT to N332.01 billion.
Accommodation and food service activities recorded the highest growth rate in VAT at 59.15%, followed by administrative and support services at 47.79%. The sectors with the lowest growth rates included extraterritorial organizations and human health and social work activities. Manufacturing, information and communication, and mining and quarrying were the top contributors to VAT revenue.
Overall, despite the quarterly drop, CIT collections increased by 109.93% year-on-year from Q1 2023 to Q1 2024, while VAT collections saw a 101.65% year-on-year increase over the same period. The data indicates significant shifts in sectoral contributions and highlights the complex economic landscape Nigeria faces, with certain sectors booming while others struggle amidst ongoing financial challenges.