Government Tax Revenues Skyrocket in Q2 2023, Breaking Records at N2.31tn

Government revenue experienced a significant surge in the second quarter (Q2) of 2023, with taxes collected from both companies and consumers increasing by 96.11% to N2.31tn.

This upswing marked a substantial leap from the first quarter of the year.

In Q1 of 2023, the National Bureau of Statistics reported that the combined tax contributions from companies and consumers amounted to N1.18tn.

The increase in tax revenue recorded in Q2 can be primarily attributed to the growth in Company Income Tax, which soared by an astonishing 226.40% quarter-on-quarter to N1.53tn, compared to the N469.01bn reported in Q1, 2023.

According to the latest Company Income Tax report by the National Bureau of Statistics, companies operating in Nigeria contributed approximately N1.53tn in taxes to the government during the second quarter of 2023.

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The Federal Inland Revenue Service defines Company Income Tax as a 30% tax levied on corporate profits.

An analysis revealed that this marks the first instance in which companies have contributed over N1tn in a single quarter.

Data from the National Bureau of Statistics underscores the significance of this achievement, with tax collections in Q2 2023 surpassing the total annual collections in 2015 (N1.38tn), 2016 (N1.02tn), 2017 (N1.25tn), and 2018 (N1.41tn).

The highest amount collected in previous quarters was N810.19bn in Q3 2023, while the lowest reported figure was N155.96bn in Q1 2017.

In contrast, Value Added Tax (VAT), a 7.5% consumption tax borne by the end consumer of a product, experienced a more modest 10.11% quarter-on-quarter increase in Q2, rising to N781.35bn from N709.59bn in Q1.

Commenting on the taxes, the NBS said, “On the aggregate, CIT for Q2 2023 was reported at N1.53tn, indicating a growth rate of 226.40 per cent on a quarter-on-quarter basis from N469.01bn in Q1 2023. Local payments received were N1.02tn, while Foreign CIT Payment contributed N505.91bn in Q2 2023.”

For VAT, it stated, “On the aggregate, VAT for Q2 2023 was reported at N781.35bn, showing a growth rate of 10.11 per cent on a quarter-on-quarter basis from N709.59bn in Q1 2023. Local payments recorded were N512.03bn, Foreign VAT Payments were N142.63bn, while import VAT contributed N126.69bn in Q2 2023.”