Offshore Google, Netflix, Facebook, others remit N3.8tr tax, up 68%
By Jeph Ajobaju, Chief Copy Editor
Google, Netflix, Facebook, and other offshore digital firms operating in Nigeria paid N3.85 trillion in taxes to the country by the first nine months of 2024 (M9 2024), up 68.12 per cent on N2.29 trillion paid by M9 2023.
The latest figures compiled by the National Bureau of Statistics (NBS) show that the amount includes Company Income Tax (CIT) and Value Added Tax (VAT).
The taxes increased 26.21 per cent from N1.03 trillion in the first quarter of 2024 (Q1 2024) to N1.52 trillion in Q2 2024, which declined to N1.30 trillion in Q3 2024.
The report shows significant improvement in tax remittance, with CIT yielding N2.57 trillion in M9 2024, a 43.65 per cent rise on N1.789 trillion in M9 2023.
VAT jumped to N1.28 trillion in M9 2024, surging 157.03 per cent above N498.34 billion in M9 2023, fuelled by improved collection drive.
The Federal Inland Revenue Service (FIRS) pegs CIT at 30 per cent on companies’ profit and VAT at 7.5 per cent paid when goods are purchased and services rendered and borne by the final consumer.
According to the NBS, earnings from CIT rose 42.49 per cent from N598.13 billion in Q1 2024 to N1.12 trillion in Q2 and N852.29 billion in Q3.
VAT yielded N435.73 billion in Q1 2024, N395.74 (Q2) and N448.85 billion (Q3), an increase of N13.12 billion or 3.01 per cent.
Abuja began in 2020 plans to collect tax from foreign digital service providers offering services and earning revenue in naira due to their high acceptance by Nigerians.
The service providers include video streaming sites, social media platforms, and companies that offer downloads of digital content.
Netflix, Facebook, and Twitter, among others operating without a physical office in Nigeria, offer digital video and advertising services to Nigerians.
The firms also include Alibaba and Amazon which generate revenue from Nigeria by processing and transmitting data collected about users in Nigeria, provide goods or services directly or through a digital platform, or offer intermediate services that link suppliers and customers.
These earnings are expected to increase when other social platforms start remitting taxes to the government.
Last week, the National Information Technology Development Agency (NITDA) announced that TikTok and X (Twitter) are yet to comply with tax filing required by Nigeria’s regulatory framework.
But Google, LinkedIn, and Meta (owner of Facebook) have met their tax compliance obligations outlined in Part III, Sections 3–1, and Part II, Section 10 of the “Code of Practice for Interactive Computer Service Platforms and Internet Intermediaries (CoP for ICSP/II).”
Former federal Accountant General Oluwatoyin Madein reiterated earlier this year that tax revenue is currently the highest source of treasury earnings.
She disclosed that “tax revenues today are the highest source of revenue accruing to the federation. Therefore, at the Federation Account Allocation Committee (FAAC) meetings, we eagerly await the numbers coming from the FIRS because the performance keeps on increasing and brings succour to all tiers of government.”
The government gave the FIRS a tax revenue target of N19.4 trillion for 2024 to remit over ₦18.5 trillion.
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