Nigeria recorded a significant decline in Company Income Tax revenue in the first quarter of 2026, as weaker tax collections across several sectors weighed on government earnings despite robust contributions from foreign companies and major industries.
According to figures released by the National Bureau of Statistics (NBS), CIT collections amounted to N1.37 trillion in Q1 2026, representing an 8.08 percent decrease from the N1.49 trillion generated in the fourth quarter of 2025.
On a year-on-year basis, the decline was even more pronounced, with revenue falling by 31.05 percent compared to the corresponding period in 2025, according to Nairametrics.
The data highlighted the dominant role played by multinational corporations in Nigeria’s corporate tax structure during the review period. Foreign companies contributed N828.82 billion to total CIT receipts, while domestic firms accounted for N538.91 billion, bringing overall collections to N1.37 trillion.
Despite the substantial contribution from foreign businesses, overall tax revenue contracted during the quarter. Foreign firms were responsible for more than 60 percent of total Company Income Tax receipts, reinforcing their importance to Nigeria’s non-oil revenue base and broader fiscal framework.
A breakdown of tax performance across sectors revealed mixed outcomes. The water supply, sewerage, waste management and remediation sector posted the strongest quarter-on-quarter growth, with CIT payments surging by 485.71 percent. Activities of households as employers and undifferentiated goods and services-producing activities for own use followed, recording a growth rate of 197.04 percent.
In contrast, agriculture, forestry and fishing registered the steepest decline, with CIT payments dropping by 73.52 percent. The construction sector also experienced a sharp downturn, as tax collections from the industry fell by 63.15 percent during the period.
Financial and insurance activities remained the largest source of Company Income Tax revenue, accounting for 24.73 percent of total collections in the first quarter. Mining and quarrying contributed 16.06 percent, while the manufacturing sector represented 13.82 percent of total CIT receipts.
At the lower end of the contribution scale, activities of households as employers and undifferentiated goods and services-producing activities for own use accounted for only 0.01 percent of total collections. Activities of extra-territorial organisations and bodies contributed 0.13 percent, while the water supply, sewerage, waste management and remediation sector made up 0.38 percent.
The decline in Company Income Tax revenue comes as the federal government continues efforts to strengthen non-oil revenue streams and reduce reliance on crude oil earnings. CIT remains one of Nigeria’s most important sources of internally generated revenue and a critical component of fiscal sustainability.
As part of ongoing reforms, President Bola Tinubu signed four major tax reform bills into law in June 2025. The legislation includes the Nigeria Tax Bill, Nigeria Tax Administration Bill, Nigeria Revenue Service (Establishment) Bill, and the Joint Revenue Board (Establishment) Bill, all aimed at modernising the country’s tax and revenue administration system.
The reforms officially took effect in January 2026, marking the beginning of a new tax administration regime. In a further move to expand the tax net, the federal government introduced new presumptive tax regulations for Micro, Small and Medium Enterprises (MSMEs) nationwide in March 2026.
