THE total value-added tax (VAT) collection for the second quarter (Q2) of 2024 rose to N1.56 trillion from N781.35 billion in the corresponding quarter of 2023.

The National Bureau of Statistics (NBS) disclosed this in its quarterly VAT report on Sunday, September 8.

It shows the total VAT collections in the review quarter grew by 99.82 per cent on a year-on-year basis

The VAT collected in Q2 2024 was also higher than the N1.43 trillion collected in the first quarter of this year, showing a growth rate of 9.11 per cent on a quarter-on-quarter.

According to NBS, collections from local payments were N792.58 billion, foreign VAT payments were N395.74 billion, and import VAT contributed was N372.95 billion in Q2 2024.

It shows that on a quarter-on-quarter basis, human health and social work activities recorded the highest growth rate with 98.44 per cent to N2.16 billion.

This was followed by agriculture, forestry, and fishing with a 70.26 per cent increase to N2.08 billion and water supply, sewerage, waste management, and remediation activities with 59.75 per cent to N546.81 million.

The top three sectors that contributed the most to the total VAT collection in the review quarter were manufacturing, information and communication, and mining and quarrying, the NBS stated.

Of the total VAT collection of N1.56 trillion, the manufacturing sector contributed N183.89 billion, representing 11.78 per cent; information and communication, N140.795 billion, representing 9.02 per cent; and mining and quarrying N137.18 billion, representing 8.79 per cent.

The federal, state, and local collect about 55 taxes and levies but with the ongoing reform, the presidential fiscal policy and tax reform committee has proposed the taxes and levies be prone to about eight.

The committee’s proposed tax items are income tax, value-added tax, property tax, customs duties, excise tax, stamp duties, special levy, and harmonised levy.

The key objective is to do away with nuisance taxes with meagre revenue yield, high cost of collection, and ultimate burden on the poor and small businesses and focuses on high revenue-yielding taxes that are broad-based and relatively easy to collect.

It is also to merge taxes and levies that are imposed on the same or substantially similar tax base, keep the total number of taxes across all levels of government to a single digit, and institutionalise the tax harmonisation reform to ensure sustainability.

The ICIR reports that VAT is a consumption tax levied on goods and services at each stage of the supply chain where value is added and it is one of the highest-yielding revenues for the Nigerian government.

It is one of the recommended taxes that the presidential fiscal and tax committee set up by President Bola Tinubu in July 2023 is working on to harmonise Nigeria’s fiscal policy and tax system.

The committee has recommended that the about 55 taxes and levies collected by the federal, state, and local governments be pruned to about eight taxes, a report by The ICIR explains the ongoing tax reform.