— 1min read
THE Nigerian government has raked in N424.71 billion as value-added tax (VAT) in the third quarter of 2020, according to the National Bureau of Statistics.
The data provided by the Federal Inland Revenue Service (FIRS), verified and validated by the NBS shows that there was an increase of about 54.37 percent in the VAT received in Q3 of 2020 when compared to that of Q3, 2019 (N327.2 billion).
According to Investopedia, VAT is a consumption tax that is levied on a product repeatedly at every point of sale at which value has been added.
Analysis of the VAT data shows that ‘Other Manufacturing’ generated the highest amount of VAT with N47.07 billion generated and closely followed by Professional Services generating N44.01 billion.
Commercial and Trading generated N21.18 billion while Mining generated the least and closely followed by Textile and Garment Industry; and Pharmaceutical, Soaps & Toiletries with N64.50million, N346.27 million and N386.16 million generated respectively.
Out of the total amount generated in Q3 2020, N214.66 billion was generated as Non-Import VAT locally while N115.34 billion was generated as Non-Import VAT for foreign. The balance of N94.70bn was generated as Nigeria Customs Service (NCS)-Import VAT.
In an interview with The ICIR in May, Aboderin Martins, a financial consultant, had said that revenue from VAT would increase because of the increase in VAT.
“Nigerians should expect increased revenue from taxes because of the recent increase in VAT, but the question is, would it be channeled into the right place,” Aboderin said.