FG’s revenue jumps 76% from taxes, oil

The Federal Government’s earnings jumped 76 percent from N7.1 trillion in 2022 to N12.5 trillion in 2023, thanks to higher tax collections and oil revenues, according to the new 2025-2027 Medium Term Expenditure Framework and Fiscal Strategy Paper from the Ministry of Budget and Economic Planning.

Oil revenue saw a dramatic 200 percent increase, rising from N0.8 trillion in 2022 to N2.4 trillion in 2023, making up 19.2 percent of total revenue. This big jump came mainly from producing more oil – up from 1.31 million barrels per day in 2022 to 1.41 million in 2023.

Non-oil revenue grew by 57.8 percent from N6.4 trillion to N10.1 trillion, contributing 80.8 percent of total revenue. While actual oil and gas revenue of N7.87 trillion fell short of the N9.38 trillion target, the government’s share after deductions was N4.93 trillion, beating expectations by N306 billion.

Tax collections exceeded targets across the board. Corporate Income Tax brought in N4.27 trillion and Value-Added Tax reached N3.64 trillion, both beating their goals. Customs collected N1.98 trillion, reaching 79.6 percent of its target.

The government also collected other revenues, including N1.84 trillion in independent revenues, N159 billion from Special Accounts, N256.99 billion in Signature bonuses, and N719.44 billion in Education Tax. Government-owned enterprises kept N2.19 trillion, and Grants/Aid totalled N1.57 trillion.

The budget office said “The expectation is for increased and sustainable revenue streams as the positive effects of the diverse reforms begin to yield the desired results.

“The government will therefore be able to meet its fiscal obligations and implement programmes and projects articulated in the Renewed Hope Agenda of the current Administration.

“While the increase in the non-oil revenue raises the tax-GDP ratio, Nigeria still ranks low when compared with nations with similar economic potentials.

“This narrative could possibly change with the full implementation of the recommendations of the Presidential tax reform committee.