Federation account grew to N6.86tn from corporate tax, VAT – CBN

Money flowing into Nigeria’s federation account grew to N6.86 trillion in the third quarter of 2024, according to a new Economic Report from the Central Bank of Nigeria. This was a 7.48 per cent increase from the previous quarter. The extra money came mainly from increased company taxes and VAT (value-added tax).

Most of the money came from non-oil sources, which brought in N5.56 trillion, while oil revenue made up the rest.

Here’s what the CBN report said exactly: “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.”[admnager ad_id="desktop_1" placement="desktop" lazy="false"]

The report continued: “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.”

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About the non-oil revenue specifically, the report noted: “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.”

Oil revenue actually dropped by 24.72 per cent to N1.30 trillion compared to the previous quarter. This decrease happened because of problems with old oil pipelines and equipment.

From the total N6.87 trillion collected, the government shared N3.92 trillion among different levels of government: The federal government got N1.27 trillion, state governments received N1.36 trillion, and local governments got N0.99 trillion. Oil-producing states received an additional N0.30 trillion through the 13 per cent Derivation Fund.