Receipts into the federation account grew by 7.48 per cent to N6.86 trillion in the third quarter of 2024, the latest Economic Report by the Central Bank of Nigeria has revealed.
According to the report, the increase in the gross federation account earnings was driven by higher receipts from corporate tax and value-added tax.
The Federal Internal Revenue Service describes corporate tax as a tax levied on the profits made by companies operating in Nigeria. It is regulated by the Companies Income Tax Act under the supervision of the FIRS, while VAT is a tax levied on the consumption of goods and services.
The non-oil revenue was N5.56tn, as oil revenue made up the balance.
The CBN report said, “Gross federation account earnings improved, occasioned by higher receipts from non-oil revenue. At N6.86tn, the provisional gross federation account receipt was 7.48 per cent above the level in the preceding quarter but 23.71 per cent short of the benchmark.
“The increase was due largely to higher receipts from corporate tax and value-added tax. The composition of gross federation revenue showed that non-oil revenue remained dominant, accounting for 81.00 per cent, while oil revenue constituted the balance.
“Non-oil revenue, at N5.56tn, was 19.48 and 50.36 per cent above the levels in the preceding quarter and target, respectively. The increase relative to the preceding quarter was driven largely by higher collections from corporate tax and value-added tax. The increase relative to quarterly targets reflects improved revenue collection relative to budget expectations.”
The apex bank revealed that in the quarter under review, oil revenue, however, fell by 24.72 per cent to N1.30tn, relative to the level in Q2 2024 on account of lower receipts from petroleum profit, taxes, and royalties.
It was also 75.39 per cent short of the quarterly target due to shut-ins arising from ageing oil pipelines and installations.
Meanwhile, from the federally collected revenue of N6.87tn, about N3.92tn was distributed to the three tiers of government.
The federal, state, and local governments received N1.27tn, N1.36tn, and N0.99tn, respectively, while the balance of N0.30tn was allocated to the 13 per cent Derivation Fund for oil-producing states.
