An analysis by The PUNCH has shown that from 2019 to 2021, the Federal Government of Nigeria has forgone a total of NGN16.79 trn to large companies. This analysis is based on the Tax Expenditure Statement (TES) reports in the Medium-Term Expenditure and Fiscal Strategy Papers released by the Budget Office of the Federation. According to The PUNCH, Nigeria gave up a total of NGN4.2 trn in 2019, NGN5.8 trn in 2020, and NGN6.79 trn in 2021.
Based on the 2019 TES report, the NGN4.2 trn revenue given up by FG was from two main sources, the Companies Income Tax (NGN1.1 trn) and the Value Added Tax (NGN3.1 trn). The 2020 TES report indicated that the majority of the total revenue forgone was from VAT (NGN4.3 trn), with CIT (NGN457 bn), PPT (NGN307 bn), and Customs Duty (NGN780 bn) also contributing to the loss from revenue waivers.
The TES Report for 2021 showed, like the two previous years, that VAT waivers (NGN3.87 trn) accounted for most of the revenue given up. Other revenue foregone included NGN548.40 bn in CIT, NGN337.70 bn in PPT, NGN1.84 trn in Customs Duty, and NGN111.15 bn in Imports VAT.
China received nearly half of the total Customs reliefs. Beneficiaries of tax reliefs included large companies like Dangote, Lafarge, Honeywell, and dozens more. As of December 2021, 46 companies had benefitted from various tax incentives and 186 other companies still had pending requests. The Tax Expenditure Statement details revenue given up by Nigeria in Companies Income Tax (CIT), Value Added Tax (VAT), Petroleum Profit Tax (PPT), and Customs Duty.