NBS Reports Decline in Company Income Tax, Surge in VAT Collections for Q3 2024
By Patience Ikpeme
The National Bureau of Statistics (NBS) has reported a significant reduction in Company Income Tax (CIT) collections for the third quarter of 2024, alongside a robust increase in Value Added Tax (VAT) collections for the same period.
According to NBS data, CIT revenue declined by 28.20% on a quarter-on-quarter basis to N1.77 trillion in Q3 2024, down from N2.47 trillion in Q2 2024. The manufacturing sector, mining, and information technology emerged as the top contributors to CIT during the quarter. Local CIT payments totaled N920.91 billion, while foreign CIT payments amounted to N852.29 billion.
On a quarter-on-quarter basis, the electricity, gas, steam, and air conditioning supply sector recorded the highest growth rate in CIT at 47.51%, followed by public administration and defense, and compulsory social security, which grew by 19.25%. Conversely, the accommodation and food services sector saw the steepest decline, with a negative growth rate of -73.32%, followed by the financial and insurance sector at -70.04%.
The manufacturing sector accounted for the largest share of CIT contributions at 25.47%, followed by mining and quarrying with 18.37%, and information and communication with 15.07%. The smallest contributors were households as employers (0.004%), water supply, sewerage, waste management, and remediation activities (0.03%), and extraterritorial organizations and bodies (0.08%).
On a year-on-year basis, CIT revenue in Q3 2024 increased by 1.37% compared to Q3 2023.
In contrast to the decline in CIT, VAT collections in Q3 2024 surged to N1.78 trillion, reflecting a 14.16% growth from N1.56 trillion in Q2 2024. Local VAT payments stood at N922.87 billion, foreign VAT payments at N448.85 billion, and import VAT contributed N410.62 billion.
The human health and social work sector posted the highest quarter-on-quarter growth in VAT revenue at 250.39%, followed by households as employers, which recorded a 102.09% growth rate. In contrast, water supply, sewerage, waste management, and remediation activities saw the steepest decline, with a negative growth rate of -41.92%, followed by extraterritorial organizations and bodies at -36.14%.
The manufacturing sector led VAT contributions with a 22.21% share, followed by information and communication (20.89%) and mining and quarrying (18.90%). At the lower end, households as employers and extraterritorial organizations and bodies each contributed 0.01%, while water supply, sewerage, waste management, and remediation activities contributed 0.03%.
Year-on-year, VAT revenue in Q3 2024 rose sharply by 88.00% compared to Q3 2023, underscoring improved tax compliance and economic activity.
The contrasting trends in CIT and VAT collections highlight the evolving dynamics of Nigeria’s fiscal landscape. While the decline in CIT may indicate reduced corporate profitability or compliance challenges, the significant rise in VAT collections reflects increased consumption and stronger enforcement measures.
