Nigeria's VAT Revenue Maintains Upward Trajectory
Nigeria's Value Added Tax collections have recorded their seventh consecutive quarterly increase, reaching an impressive N2.06 trillion in the second quarter of 2025. According to the latest report from the National Bureau of Statistics released on November 27, 2025, this represents a significant 32.15% increase compared to the N1.56 trillion collected during the same period in 2024.
Sectoral Breakdown and Performance
The VAT revenue composition reveals interesting patterns across different payment categories. Local payments emerged as the dominant contributor with N1.09 trillion, while foreign VAT payments accounted for N459.95 billion. Import VAT contributed N508.55 billion to the total collection during the review period.
Several sectors demonstrated remarkable growth rates on a quarter-on-quarter basis. Real estate activities recorded the highest growth at 155.21%, followed by agriculture, forestry and fishing with 23.64% growth. The information and communication sector also showed strong performance with 17.75% growth.
However, some sectors experienced significant declines. Human health and social work activities recorded the lowest growth rate at -68.34%, while electricity, gas, steam and air conditioning supply declined by -45.2%. Water supply, sewerage, waste management and remediation activities also decreased by -29.36%.
Leading Contributors and Economic Implications
In terms of sectoral contributions, manufacturing led the pack with 27.19% of total VAT collections, showing an increase of 1.16% from the previous quarter. Information and communication followed with 20.76% share, representing a 3.26% increase, while mining and quarrying contributed 15.04%.
At the opposite end, activities of households as employers recorded the lowest share at just 0.005%, followed by activities of extraterritorial organizations and bodies at 0.02%, and water supply, sewerage, waste management at 0.03%.
The consistent growth in VAT collections began in the third quarter of 2023, following the government's economic reforms including the removal of fuel subsidy and unification of exchange rates. The trend shows:
- Q3 2023: N948.07 billion
- Q4 2023: N1.2 trillion
- Q1 2024: N1.43 trillion
- Q2 2024: N1.56 trillion
- Q3 2024: N1.78 trillion
- Q4 2024: N1.95 trillion
- Q2 2025: N2.06 trillion
This steady upward movement in VAT revenue demonstrates the resilience of Nigeria's tax system and provides crucial funding for government developmental projects across the country.
