Nigeria, through the National Bureau of Statistics (NBS), will release the corporate income tax report for Q2 2024 as the United States Labour Statistics is expected to publish its unemployment data.
Monday, September 2
NBS to release Company Income Tax report, Q2 2024
The National Bureau of Statistics will release the Company Income Tax (CIT) data for the second quarter of 2024 on Monday.
CIT, also known as corporate tax, declined by 12.9 percent in the first quarter of 2024, NBS data shows.
Corporate tax for Q1 2024 fell to N984.61 billion from N1.13 trillion in the last quarter of 2023.
“Analysts blame the fall of corporate taxes on the exodus of multinationals in the country, the weak naira, and high energy costs.”
CIT is a levy the government imposes on the income of a company. The rate is hinged on zero percent for companies with a gross turnover of N25 million or less, 20 percent for companies with a gross turnover greater than N25 million and less than N100 million, and 30 percent for large companies above N100 million.
A breakdown of the NBS report revealed that out of 21 sectors, manufacturing activities, which used to contribute the most tax revenue, recorded the lowest growth rate. This affected the aggregate CIT in the first three months of 2024.
Since President Bola Tinubu announced the removal of the petrol subsidy, pump prices have more than tripled, while the value of the naira has plunged following the floating of the currency, sparking a decline in the bottom lines of companies operating in Nigeria.
Nigeria’s harsh business environment has also forced more multinationals to exit the country. Within 10 months, six of them have left the country. They are Kimberly-Clark, Procter & Gamble (P&G), GlaxoSmithKline Consumer (GSK) Nigeria, Equinor, Sanofi, and Bolt Food.
Analysts blame the fall of corporate taxes on the exodus of multinationals in the country, the weak naira, and high energy costs.
Read also: Why are banks against windfall tax?
Wednesday, September 4 2024
CBN to auction N233.31 billion NT-Bills
The Central Bank of Nigeria will be auctioning Treasury bills worth N233.31 billion on Wednesday.
It will be auctioning N19.60 billion for the 91-day tenor, N10.55 billion for the 182-day tenor, and for the 364-day N203.15 billion.
At the last auction, CBN rolled over a total of N409.97 billion across the 91-, 182-, and 364-day tenors and sold only N384.93 billion.
Only N197.1 billion worth of one-year Treasury bills was sold despite being oversubscribed to the tune of N909.5 billion. The auction saw a downward move in stop rate to 20.9 percent from 21.89 percent in the previous auction for the one-year bill.
The subscription was three times more than the N283 billion that was offered.
The CBN plans to issue N2.20 trillion in Treasury bills during the fourth quarter of 2024, matching the amount set to mature from September to November this year.
The amount to be offered in Q4 is 41.03 percent higher than N1.56 trillion issued in the preceding (third) quarter of 2024.
Read also: CBN plans N2.20trn treasury bills issuance in Q4 to control liquidity
Friday, September 6
US to release unemployment rate
The US Bureau of Labour Statistics will be releasing its unemployment data for August 2024 on Friday.
The unemployment rate ticked higher to 4.3 percent in August, compared to 4.1 percent last month. This is however lower than the long-term average of 5.69 percent. The forecast had been for the jobless rate to hold steady at 4 percent.
The jump in the unemployment rate in June reflected a further decline in household employment.
The mixed report boosts the odds that the Federal Reserve will start cutting interest rates in September as the labour market remains fairly tight.
Jerome Powell’s warning that the Fed does “not seek or welcome further cooling in labour market conditions” basically means the current unemployment rate of 4.3 percent, which is still fairly low by historical standards, is now a “line in the sand” that, if crossed, will likely trigger a policy response.
The unemployment rate measures the percentage of the total workforce that is not working yet actively seeking employment.
A reading that is higher than forecast is generally negative for the USD, while a lower than forecast reading is generally supportive for the USD.
Read also: Rising remittances, reserves fail to shore up naira
Naira to continue to moderate at N1,500/1,600
The naira is expected to continue to moderate between N1,500 and N1,600 per one US dollar till the end of the year on sustained monetary policies.
The local currency lost 0.79 percent to the USD as it closed at 1,593.93 on Thursday at the Nigerian Autonomous Foreign Exchange Market (NAFEM), according to data from the FMDQ Securities Exchange Limited.
The CFG Advisory, a financial services firm, said the exchange rate is expected to end the year between N1,500 and 1,800 per $1, given the recent interventions by the CBN.
“Our benchmark exchange rate recommendation for year-end 2024 has been validated by events and remains at N1,500-1,800/US$,” the Lagos-based financial reporting firm said in a recent report.
The Central Bank of Nigeria (CBN) has continued to put in efforts to shore up the ailing naira by offloading a record amount of dollars directly to businesses, but it has not delivered the impact many, including the apex bank itself, expected it would.
Since the CBN’s sale of some $815 million directly to businesses from manufacturers to airlines on August 6, the biggest single-day intervention under new governor Olayemi Cardoso, the naira has barely budged.
A recent survey by CBN shows that Nigerian firms expect the naira to depreciate between now and December but have a positive outlook for the local unit next January.
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