Nigerian companies are stepping up their contributions to the national purse despite challenges in the business environment.
The latest data from the National Bureau of Statistics (NBS) shows that Nigeria made N4.9 trillion from Company Income Tax (CIT) payments in 2023.
Here are the top 10 CIT contributors locally in 2023:
#10 Electricity, Gas, Steam, and Air Conditioning Supply
Contributing N50.9 billion in 2023, up from N30.9 billion in 2022, the Electricity, Gas, Steam, and Air Conditioning Supply sector has seen a 65% increase in CIT contributions.
Despite this growth, challenges such as unreliable power supply, infrastructural weaknesses, and the transition to sustainable energy sources continue to hinder the sector’s efficiency and reliability.
Addressing these concerns is pivotal for achieving consistent economic growth and meeting the energy demands of Nigeria’s growing population.
#9 Construction
The Construction sector’s CIT payment rose from N34.5 billion in 2022 to N54.9 billion in 2023, a 59% increase.
Although experiencing robust growth, the sector grapples with the high cost and volatility of building materials, regulatory fluctuations, and the challenge of meeting the infrastructure needs of Nigeria’s expanding urban environments.
Tackling these issues is critical for sustaining the sector’s growth and enabling it to contribute to national development effectively.
#8 Other Service Activities
The Other Service Activities sector contributed N83.6 billion in 2023, up from N79.4 billion in 2022, and has shown modest growth of 5%. The sector encompasses a broad range of services.
It faces challenges such as informality, regulation disparities, and the pressing need for innovation and upskilling to remain competitive in a global market.
Enhancing service standards and embracing digital transformation are key to this sector’s advancement.
#7 Transportation and Storage
The Transportation and Storage sector contributed N94.9 billion in 2023, a significant increase from N69.7 billion in 2022, marking a 36% growth.
The sector, crucial for Nigeria’s economic activities, confronts persistent infrastructural deficits and logistical inefficiencies. Improving transport links and storage facilities is essential for supporting commerce and industry throughout the country.
#6 Wholesale and Retail Trade, Repair of Motor Vehicles and Motorcycles
This sector made a substantial leap in its CIT contributions, from N60.1 billion in 2022 to N115 billion in 2023, reflecting a 91% increase.
The sector faces the ongoing challenge of competing with the informal sector, coping with counterfeit goods, and navigating complex supply chains.
Strategies to strengthen supply chain resilience and support formalisation are necessary to capitalise on the sector’s growth potential.
#5 Public Administration and Defence, Compulsory Social Security
CIT contributions in this sector increased by 37%, from NGN 95.4 billion in 2022 to N130.6 billion in 2023.
Challenges remain in bureaucratic inefficiency and the need for fiscal reforms to improve public sector management and service delivery, which are crucial for national development and security.
#4 Mining and Quarrying
In the Mining and Quarrying sector, CIT contributions jumped from N141.6 billion in 2022 to N235.2 billion in 2023, a 66% increase.
The sector’s challenges include navigating environmental regulations, enhancing operational infrastructure, and ensuring that mining practices are sustainable and beneficial to the country’s economy.
#3 Financial and Insurance Activities
The sector witnessed a remarkable 120% increase in its CIT contributions, rising from N208.9 billion in 2022 to N458.8 billion in 2023.
Financial inclusion, regulatory compliance, the integration of technological innovation, and cybersecurity are the primary challenges facing the sector as it continues to expand.
#2 Information and Communication
Rising from N362.3 billion in 2022 to N466.6 billion in 2023, the Information and Communication sector saw a 29% increase in CIT contributions.
The sector must overcome challenges related to bridging digital divides, enhancing cybersecurity, and ensuring regulatory frameworks that support innovation and growth.
#1 Manufacturing
The Manufacturing sector, the largest contributor, increased its CIT contributions by 34%, from N468.6 billion in 2022 to N626.4 billion in 2023.
High production costs, electricity supply inconsistencies, and infrastructural gaps are ongoing issues that need to be addressed to sustain the sector’s development and its significant role in Nigeria’s economy.
