Nigeria's Non-Oil Tax Revenues Show Strong Growth in 2025
Nigeria has recorded significant expansion in its non-oil tax revenues during the first nine months of 2025, with both Value Added Tax (VAT) and Company Income Tax (CIT) collections posting impressive year-on-year increases. The latest figures released by the National Bureau of Statistics (NBS) reveal a substantial boost in government revenue from these critical sources, highlighting the country's economic resilience and diversification efforts.
VAT Revenue Climbs to N6.4 Trillion
According to the NBS report, VAT revenue experienced a remarkable 34 per cent increase, reaching N6.4 trillion in the nine-month period ending September 2025. This represents a substantial rise from the N4.77 trillion collected during the same timeframe in 2024. The growth underscores the expanding economic activities and improved tax compliance across various sectors of the Nigerian economy.
Quarterly Performance and Sectoral Breakdown
On a quarterly basis, VAT collections demonstrated slight fluctuations but maintained an overall upward trajectory. Revenue dipped marginally by 1.4 per cent to N2.03 trillion in the second quarter of 2025, down from N2.06 trillion in the first quarter. However, this was followed by a strong rebound in the third quarter, with collections rising by 10.66 per cent quarter-on-quarter to N2.28 trillion. Year-on-year, VAT in Q3 2025 expanded by an impressive 28.1 per cent.
A detailed breakdown of Q3 2025 collections shows that local VAT generated N1.12 trillion, while foreign VAT contributed N680.23 billion. Import VAT stood at N479.79 billion, reflecting the continued importance of international trade in Nigeria's tax revenue structure.
Sectoral Performance Highlights
Sectoral analysis revealed particularly strong expansion in several key areas. Administrative and Support Services recorded the highest quarter-on-quarter growth at 89.28 per cent, followed closely by Arts, Entertainment and Recreation with 82.49 per cent growth. The Human Health and Social Work sector also showed robust expansion, growing by 32.4 per cent.
In contrast, the Real Estate sector experienced the sharpest contraction, declining by 51.33 per cent. Manufacturing accounted for the largest share of VAT contributions at 25.89 per cent, demonstrating its continued dominance in the Nigerian economy. Information and Communication followed with 18.77 per cent, while Mining and Quarrying contributed 14.85 per cent to the total VAT collections.
Company Income Tax Shows Remarkable Improvement
Company Income Tax also demonstrated significant growth, increasing by 48 per cent to N7.72 trillion in the first nine months of 2025. This represents a substantial improvement from the N5.22 trillion recorded during the same period in 2024, indicating stronger corporate performance and improved tax collection efficiency.
Quarterly CIT Performance
Quarterly data for CIT revealed consistent growth throughout the year. Collections stood at N1.98 trillion in Q1 2025, then rose sharply by 40 per cent to N2.78 trillion in Q2 2025. The third quarter saw a further increase of 5.7 per cent to N2.96 trillion. The Q3 performance represented a remarkable 67.19 per cent year-on-year increase, highlighting the accelerating pace of corporate tax revenue growth.
Domestic and Foreign Contributions
Further analysis of the Q3 2025 CIT data shows that domestic payments totaled N1.21 trillion, while foreign CIT payments amounted to N1.75 trillion. This breakdown emphasizes the strong role of foreign-sourced earnings in Nigeria's overall tax revenue, reflecting the country's increasing integration into the global economy and the growing presence of multinational corporations operating within its borders.
The robust performance of both VAT and CIT collections suggests that Nigeria's economic diversification efforts are yielding positive results, with non-oil sectors contributing significantly to government revenue. The data also indicates improved tax administration and compliance measures, which are crucial for sustainable economic development and public service delivery.
