The Nigerian Inland Revenue Service Generated N512.23 billion As VAT In Q2

The Federal Government of Nigeria realized the amount of N512.23 billion as Value Added Tax (VAT) in the second quarter of the year 2021, according to the value-added tax report released by the National Bureau of Statistics (NBS).

The Value Added Tax revenue realized in the second with saw a 56 percent increase year-over-year. In the second quarter of 2020, the Federal Government of Nigeria recorded the sum of N327.2 billion as Value Added Tax. The latest figures also represent a 3.2 percent increase over the N496.4 billion Value Added Tax revenue recorded in the first quarter of 2021.

The Value Added Tax remittances were received from the various sectors in the country.

The sum of N44.89 billion was received from the manufacturing sector and was the highest remittance. The manufacturing sector accounted for 8.76 percent of the total Value Added Tax collections by the federal government.

Professional services accounted for 5.72 percent of the total Value Added Tax collections by the government. It remitted the sum of N29.3 billion, representing a 31 percent decrease in the sector’s Value Added Tax remittance, compared to N42.5 billion recorded in the previous quarter.

Remittances from the mining sector surged from N48.36 million in Q1 2021 to N8.11 billion in Q2 2021. The mining sector which was at the bottom spot in the first quarter of 2021 jumped by over 16,000 percent to rank among the top six.

Pioneering remitted N168.99 million, while the textile and garment industry recorded the least remittance of N77.74 million.

The sum of N117.13 billion was generated as NCS-Import VAT. While the amount of N207.69 billion was generated for Non-Import Value Added Tax for foreign, the sum of N187.3 was generated locally.

The latest figures set a new record for the highest Value-Added Tax recorded in a quarter. Value Added Tax revenue started surging in the first quarter after the government increased the VAT rate from 5 percent to 7.5 percent. In the first quarter of 2021, Nigeria’s Value Added Tax collections amounted to N496.4 billion, a 52.93 percent jump from the same period a year ago (Q1 2020), when it recorded the sum of N324.58 billion as Value Added Tax.

Nigeria, amongst other countries, was hit by the pandemic and is still recovering from the tragic economic impacts. The rise in Value Added Tax collections indicates increased economic activity, as the country struggles to revive its economy.