“If you look at Ghana, the level of formality and organisation of business is better than Nigeria. Today, the tax collected in Ghana is about 21 per cent of their Gross Domestic Product…..At the last count, about 350, 000 companies have not rendered tax returns in the country. So we need to strategise. We need to research and find out what could be done to improve tax rendition and tax collection, what could be done to encourage accounting for activities…….In fact, in most African countries, tax collection is about 10 per cent of GDP but in Nigeria, the total tax collected is just seven per cent of GDP. That shows that so many people and companies are not rendering tax return”.
Minister of State, Finance, Dr. Lawal Yerima Ngama
The Minister for Finance (His Boss) was also quoted last week as saying Nigeria’s tax revenue is about 7% of GTB. It is uncertain how they come up with these figures but Nigeria’s GDP as at end of 2012 was about N40.5trillion and tax collected was about 5trillion which by my calculation is 12.5%. However, Company Income Tax collection was just N847.5billion for 2012 which puts it at about 2.1%. So I am guessing they added Vat and WHT. I wonder how they came up with the 350,000 number too.