Banks and other financial institutions have generated on behalf of the government, a total sum of N24.77 billion as Value Added Tax (VAT) in 2020, up by 44.4% when compared to N17.15 billion recorded in 2019.
This is according to the Sectoral value-added tax report, recently published by the National Bureau of Statistics (NBS).
On a quarterly basis, financial institutions generated the highest VAT figures of N7.36 billion in Q4 2020, up by 64.77% Year-on-Year. This is sequel to the sums of N5.43 billion (Q1, 2020), N5.11 billion (Q2, 2020), and N6.87 billion (Q3, 2020) generated earlier.
The growth in the generated VAT figures might be attributable to the implementation of the modified VAT structure of 7.5% which became effective on February 1, 2020.
Historical trend
The major highlight of VAT generated by the government from financial institutions and their percentage in relation to the total VAT revenue is succinctly captured below;
- In 2015, banks and financial institutions generated on behalf of the government, a total of N23.06 billion as VAT, representing 3.03% of total generated VAT across board.
- In 2016, it generated a total of N25.05 billion, representing 3.22% of the total generated VAT across board for the period under review.
- In 2017, a total sum of N20.76 billion VAT revenue was generated by the aforementioned sector, representing about 2.13% of the total VAT for the year.
- In 2018, a total sum of N18.5 billion was generated by the federal government as VAT from financial institutions, representing about 1.7% of the total VAT for the year.
- In 2019, banks remitted the total sum of N17.15 billion as VAT, representing about 1.45% of the total VAT generated across all sectors for the year.
- A total sum of N24.77 billion was generated as VAT from banks and financial institutions, representing about 1.62% of the total VAT generated across all sectors for 2020.
What you should know: Nairametrics had earlier reported that Nigeria generated N1.53 trillion VAT in 2020, up by 29% Y-O-Y.
- Nairametrics gathered that banks and other financial institutions generated the total sum of N129.29 billion as VAT between 2015 and 2020.
- Nairametrics also learnt that the sum of N7.36 billion generated by financial institutions as VAT in Q4, 2020 is the highest ever by the financial sector, since 2013.