Advertisement
Manufacturing CIT Falls 68% in Q1 2026
Company Income Tax (CIT) payments by Nigeria’s manufacturing sector fell sharply by 68.25% year-on-year to ₦74.48bn in Q1 2026, raising concerns about the sector’s ability to cope with new tax laws, weak demand, and high operating costs.
Data from the National Bureau of Statistics (NBS) showed manufacturing CIT dropped from ₦234.59bn in Q1 2025 to ₦74.48bn in Q1 2026, a decline of ₦160.11bn.
On a quarterly basis, payments fell 47.5% from ₦141.84bn in Q4 2025.
Overall, total CIT collections stood at ₦1.37tn in Q1 2026, down 8.08% from ₦1.49tn in Q4 2025, and 31.05% lower year-on-year.
Despite the fall, manufacturing remained among the top three contributors to domestic CIT, accounting for 13.82%, behind financial and insurance activities (24.73%) and mining and quarrying (16.06%).
In value terms, financial services paid ₦133.27bn, mining ₦86.55bn, and manufacturing ₦74.48bn. However, foreign CIT payments dominated, contributing ₦828.82bn (60.6%) of total collections, compared to ₦538.91bn from domestic sources.
The steep decline in manufacturing tax payments reflects weaker profitability, with firms battling high energy costs, FX pressures, expensive credit, logistics bottlenecks, and subdued consumer demand.
The first quarter also marked the transition into Nigeria’s new tax framework, which reduced CIT from 30% to 25% and introduced 0% CIT for firms with turnovers below ₦100m, raising questions about compliance timing and earnings adjustments.
Other sectors also showed weakness: agriculture fell 73.5% quarter-on-quarter, construction dropped 63.1%, while water supply and waste management recorded the highest growth at 485.7%.
Analysts warn that Nigeria’s tax base is becoming more dependent on financial services, mining, and foreign payments, while core productive sectors like manufacturing are shrinking.
