Thursday, 13 June 2024 04:48

Exodus of multinational companies leads to 12% drop in Q1 2024 Company Income Tax - NBS

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The exodus of several international companies from Nigeria has resulted in a significant reduction in Company Income Tax (CIT) revenue, which fell to N984.6 billion in the first quarter of 2024. This represents a 12.87 percent decrease from the N1.13 trillion collected in the fourth quarter of 2023, according to data from the National Bureau of Statistics (NBS).

Since President Bola Tinubu assumed office, at least seven multinational corporations have exited the country, citing an unfavorable business environment and a shortage of foreign exchange. The NBS report highlighted that local CIT payments amounted to N386.49 billion, while foreign CIT payments contributed N598.13 billion in Q1 2024.

The report also noted that on a quarter-on-quarter basis, "activities of households as employers, undifferentiated goods and services-producing activities of households for own use" recorded the highest growth rate at -330.42 percent (N70.5 million), followed by administrative and support service activities with a growth rate of 33.18 percent (N6.7 billion). Conversely, the manufacturing sector saw the lowest growth rate at -70.24 percent (N73.1 billion), followed by the electricity, gas, steam, and air conditioning supply sector at 69.14 percent (N5.1 billion).

In terms of sectoral contributions for Q1 2024, the top three were mining and quarrying at 20.94 percent (N80.9 billion), financial and insurance activities at 18.73 percent (N72.4 billion), and information and communication at 12.56 percent (N48.5 billion). Activities of households as employers, water supply, sewerage, waste management, and remediation activities, and activities of extraterritorial organizations and bodies recorded the least shares.

Despite the quarterly decline, CIT collections in Q1 2024 increased by 109.93 percent compared to Q1 2023.

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