Macroeconomic Report & Economic Updates

Nigeria Economic Update (Issue 33)

According to the National Bureau of Statistics, the volume of Value-Added Tax (VAT) has risen from ₦496.39 billion to ₦512.25 billion between Q1 and Q2 2021, reflecting a 3.2 percent growth. This is the highest ever quarterly VAT amount generated and reflects a year-on-year 56.56 percent growth. VAT collections have continued to peak, following the increase in VAT rate from 5 percent to 7.5 percent in January 2020 by the federal government. In Q2 2021, the manufacturing sector and professional services sector accounted for 8.76 percent and 5.72 percent of VAT collections with a sum of ₦44.89 billion and ₦29.3 billion respectively. Further disaggregation shows that ₦187.43 billion was generated as non-import local VAT and ₦207.69 billion was generated from non-import foreign VAT. Meanwhile, the balance of ₦117.13 billion was generated from the Nigerian Custom Service import VAT. In light of the economic recovery, there are potentials for increased mobilisation of financial resources through VAT. This will improve the government’s fiscal space and provide funding for critical sectors of the economy such as infrastructure, health and education. It therefore becomes necessary that the government improve its tax administration structure and strengthen its anti-corruption policies to avoid tax evasion.

Download Label
March 13, 2018 - 4:00 am
515.86 kB
v.1.7 (stable)