BY BAMIDELE FAMOOFO
The latest tax collection report collated and verified by the Federal Inland Revenue Service and published by the National Bureau of Statistics showed that the Federal Government pooled a total N3.5 trillion in revenue from Value-added tax and Company income tax between January and September, 2022.
This showed a 25 percent increase year on year from N2.77 trillion in the same period last year as the total CIT rose over 26 percent year on year to N1.7 trillion while the VAT printed at N1.8 trillion under nine months this year.
Meanwhile, the recent report published in December, the Federal Government recorded N625.4 billion in total value added tax during the third quarter of 2022.
This implies a 4.2 percent quarter on quarter increase from N600.2 billion in the prior quarter of 2022 and a 24.95 percent year on year rise from Q3 2021.
Elsewhere, it reported N810.2 billion in Company Income Tax in the third quarter, as the collection increased 13.4 percent quarter on quarter from N714.40 billion in Q2 and 71.5 percent in Q3 last year.
The figure continues to be on the rise above its pre-pandemic levels of N520.9 billion reported in the Q3 of 2019 and results from the boost in business and economic activities in the economy which was triggered by stanching pressures from the Covid-19 pandemic.
At the start of this year, the Federal Government began a new policy of tax which became effective January 1, 2022, through the implementation of the amended Finance Bill of 2021 and the mandate of the Act is in consonance with the Federal Government’s drive for domestic revenue mobilization for its deficit financing on the back of declining government revenues.
From the aggregate VAT collected for the period, the NBS report highlighted collections from local payments to print N367.9 billion, foreign payments at N121.9 billion while the import VAT contributed N135.6 billion during the period.
Furthermore, it was seen that the growth in the aggregate VAT during the review quarter was a result of the increased aggregate collection from the manufacturing sector which contributed 31.08 percent of the aggregate VAT.
Also, the activities from the entertainment and recreation sector grew fastest and highest in total VAT with 61.09 percent while the activities of households; water supply; sewerage and waste management sectors recorded the slowest growth in the period as the sector dipped 56.4 percent and 32 percent in that order.
From the total income tax from companies, local CIT payments received stood at N483.2 billion while the foreign sources printed at N327 billion during the review period.
Looking at the sectoral growth, the total income tax paid by companies in the arts, entertainment and recreation sector saw the highest growth during the period by 93.33 percent while the manufacturing sector emerged as the sector with the largest contributor to the income tax vault of the federal government.
Other sectoral contributions saw the information and communication and the finance and insurance sectors contributed 27.3 percent and 8.8 percent in that order.
