The Central Bank of Nigeria (CBN) has reported a 7.48% increase in receipts into the federation account, which went up by 7.48%, totaling N6.86 trillion in the third quarter of 2024. According to the latest economic report of the bank, sources of growth can mainly be found in improved collections of corporate taxes and value-added tax (VAT).
Corporate tax, which is a tax on the profits of companies as stated in the Companies Income Tax Act, and VAT, which is a tax on goods and services, greatly increased the money earned from sources other than oil. This non-oil revenue made up N5.56 trillion, or 81% of the total income.
“Most of the federation account earnings were improved as a result of increased non-oil revenues. It recorded N6.86 trillion, 7.48% higher than that of the preceding quarter but 23.71% below the benchmark.” It also attributed this to increases in corporates’ taxes and VAT collections that exceeded the quarterly targets by 50.36%.
However, oil revenue declined by 24.72% to N1.30 trillion compared to Q2 2024, and dropped to 75.39% by target owing to the lower petroleum profit tax and royalties coupled with production dislocation from ageing pipelines and installations.
Total federal income revenue collected stands at N6.87 trillion, with N3.92 trillion distributed to the three tiers of government: N1.27 trillion for the federal government, N1.36 trillion for states, N0.99 trillion for local governments, and N0.30 trillion allocated to the 13% Derivation Fund for oil-producing states.
