March 14, 2023/CSL Research

Based on data released by the National Bureau of Statistics (NBS), the Federal Inland Revenue generated a total of N5.34trn in Company Income Tax (CIT) and Value Added Tax (VAT) in 2022. This represents a 42.14% y/y increase on the N3.75trn recorded in 2021. Specifically, CIT rose 67.95 y/y to N2.83trn in 2022 from N1.69trn in 2021. Locally, this was driven by the manufacturing, information & communications and financial services sectors which contributed 16.56%, 12.80% and 7.38% to the total CIT collections in 2022.

Also, Foreign CIT payments contributed 40.63%, having leaped by 117.92% y/y to N1.15trn in 2022 from N527.62bn in 2021. Quarter on quarter, CIT moderated by 6.95% to N754.88bn in Q4 2022 from N810.19bn in Q3 2022.

On the other hand, Value Added Tax (VAT) increased by 21.16% y/y to N2.51trn in 2022 from N2.07trn in 2021. This was also driven by the manufacturing, information & communications and mining & quarrying sectors which contributed 19.01%, 10.70% and 6.31% to the total VAT
collections in 2022. Non-import (Foreign) VAT payments contributed 20.34% but declined by 9.45% y/y to N510.81trn in 2022 from N564.12bn in 2021. Quarter on quarter, VAT increased by 11.51% to N697.38bn in Q4 2022 from N625.29bn in Q3 2022.

Meanwhile, the Federal Inland Revenue Service (FIRS) had reported that it collected a total of N10.1trn in both oil (N4.09 trillion) and non-oil (N5.96 trillion) revenues compared with a target of N10.44trn. Aside CIT and VAT payments, Electronic Money Transfer Levy (EMTL) and Earmarked Taxes contributed N125.67bn and N353.69bn respectively. Overall, non-oil taxes dominated, contributing 59% of the total collections in the year, while oil tax collection made up 41% of total collection.

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