This represents a substantial 68.12 percent increase over the N2.29 trillion collected during the comparable period in 2023. The National Bureau of Statistics reported this figure on Tuesday, encompassing both Company Income Tax (CIT) and Value Added Tax (VAT) payments.
The data indicates a 26.21 percent rise in tax remittances, with collections growing from N1.03 trillion in the first quarter to N1.30 trillion in the third quarter, while N1.52 trillion was collected in the second quarter.
A detailed analysis of the reports shows that companies contributed N2.57 trillion in CIT from January to September 2024, reflecting a notable increase of 43.65 percent compared to the N1.789 trillion collected during the same timeframe in the previous year.
Furthermore, VAT collections for this period reached N1.28 trillion, marking an impressive increase of 157.03 percent from N498.34 billion in 2023. This data highlights a substantial growth in tax revenue, driven by enhanced collection efforts.
The Federal Inland Revenue Service states that CIT is a 30 percent tax on corporate profits, while VAT is a 7.5 percent consumption tax applicable to goods and services, ultimately borne by the end consumer.
On a quarterly basis, Nigeria's CIT earnings rose by 42.49 percent, increasing from N598.13 billion in Q1 to N1.12 trillion in Q2, and then to N852.29 billion in Q3. VAT collections showed earnings of N435.73 billion in Q1, N395.74 billion in Q2, and N448.85 billion in Q3, reflecting a slight increase of N13.12 billion or 3.01 percent.
In 2020, the Federal Government initiated plans to tax foreign digital service providers that generate revenue in naira, recognizing the growing acceptance of these services among the Nigerian population.
Several service providers, including video streaming platforms, social media networks, and companies that facilitate digital content downloads, are anticipated to remit digital taxes to the Federal Inland Revenue Service.
Platforms such as Netflix, Facebook, and Twitter, which have been operating in Nigeria without a physical presence, provide digital video and advertising services to the Nigerian audience. Additionally, companies like Alibaba and Amazon earn revenue from Nigeria by collecting and processing user data, delivering goods or services directly or via digital platforms, or offering intermediary services that connect suppliers and customers within the country.
These revenues are expected to rise further as additional social media platforms begin to fulfill their tax obligations to the government. Recently, the National Information Technology Development Agency reported that TikTok and X (formerly Twitter) have not yet adhered to Nigeria's tax filing requirements.
In contrast, Google, LinkedIn, and Meta have successfully complied with their tax obligations as specified in Part III, Sections 3–1, and Part II, Section 10 of the “Code of Practice for Interactive Computer Service Platforms and Internet Intermediaries (CoP for ICSP/II).”
Earlier this year, Ms. Oluwatoyin Madein, the former Accountant-General of the Federation, reported that tax revenue is currently the nation's primary revenue source. Ms. Madein observed that the substantial revenue generated from taxes results in keen anticipation among Federation Account Allocation Committee members for the monthly Federal Inland Revenue Service figures, as these funds are crucial for distribution to all three tiers of government.
She stated that tax revenues are the highest source of revenue accruing to the federation, and that the committee eagerly awaits the FIRS figures due to their increasing performance and vital contribution to all levels of government.