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Company Income Tax receipt shrinks by 20% as govt battles revenue squeeze

Company Income Tax receipt shrinks by 20% as govt battles revenue squeeze

Company Income Tax (CIT) collection by the Nigerian government contracted by 20.13% in the third quarter when set beside what was reported in the same period of last year, data from the statistics office on Thursday showed.

Q3 2020 saw N416.01 billion received compared with the N520.89 billion generated in Q3 2019 as government braced for a revenue squeeze from the fallout of coronavirus-induced lockdowns.

Africa’s largest economy has been heavily hit by the pandemic this year, forcing government to slash its spending plan by as much as N1.5 trillion, with 20% cut to capital expenditure and 25% to recurrent expenditure.

Read also: Sharp fall in company income tax triggers decline in govt’s July revenue by N183.26bn

The N416.01 billion CIT receipt represented a 3.48% jump over the figure for Q2 2020, standing at N402.03 billion.

“Professional Services including Telecoms generated the highest amount of CIT with N55.52bn generated and closely followed by Other Manufacturing which generated N42.03bn, Banks & Financial Institutions generated N24.05bn while Mining generated the least and closely followed by Textile and Garment Industry and Local Government Councils with N120.93m, N167.51m and N321.72m generated respectively,” said the National Bureau of Statistics.

Locally generated CIT accounted for N244.70 billion while foreign CIT payment contributed N70.34 billion. The rest N100.97 billion came from CIT from other payments.

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