By Adedapo Adesanya
Companies operating in Nigeria paid N3.48 trillion in Value Added Tax (VAT) and Company Income Tax (CIT) in the first half of 2023 (H1 2023) compared with the N2.97 trillion in the corresponding period of 2022, representing a 17 per cent increase, according to the latest data from the National Bureau of Statistics (NBS).
VAT is added to a product at every point of the supply chain where value is added to it while CIT is a tax levied by federal and state governments on business profits.
The breakdown showed that VAT revenue stood at N1.49 trillion in H1’23, rising year-on-year by 25 per cent from N1.19 trillion in the previous year, while revenue from CIT rose year-on-year by 11.7 per cent to N1.99 trillion in the first six months of the year from N1.78 trillion in H1’22.
The NBS report stated that on the aggregate, VAT for the second quarter 23 was reported at N781.35 billion, showing a growth rate of 10.11 per cent on a quarter-on-quarter basis from N709.59 billion in Q1 2023.
“Local payments recorded were N512.03 billion, Foreign VAT Payments were N142.63 billion, while import VAT contributed N126.69 billion in Q2’23,” the stats office said.
The report said on a quarter-on-quarter basis, the activities of extraterritorial organizations and bodies recorded the highest growth rate with 212.06 per cent, followed by real estate activities with 123.09 per cent.
“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 –57.06 per cent, followed by agriculture, forestry, and fishing with –32.86 per cent.
“In terms of sectoral contributions, the top three largest shares in Q2’23 were manufacturing with 29.64 per cent; information and communication with 21.19 per cent; and financial and insurance activities with 11.18 per cent.”
In its Q2 2023 CIT report, NBS said: “On the aggregate, CIT for Q2 2023 was reported at N1.53 trillion, indicating a growth rate of 226.40 per cent on QoQ basis from N469.01 billion in Q1’23.
“Local payments received were N1.02 trillion, while Foreign CIT Payment contributed N505.91 billion in Q2 2023.
“In terms of sectoral contributions, the top three largest shares in Q2’23 were manufacturing with 25.63 per cent, financial and insurance activities with 24.47 per cent and information and communication with 20.3 per cent.”
Modupe Gbadeyanka