Google, Netflix, others paid ₦2.57tr tax to FG in nine months

Google, Netflix, META and other foreign companies operating in Nigeria paid ₦2.57 trillion in taxes to the federal government within the first nine months of 2024, according to the National Bureau of Statistics.

The figure represents a 44% increase from the ₦1.79 trillion recorded during the same period last year, the NBS said.

The NBS’s Company Income Tax (CIT) report shows quarterly variations in collections, with ₦598.1 billion generated in the first quarter, ₦1.12 trillion in the second quarter, and ₦852.3 billion in the third quarter.

Despite this growth, the third-quarter figures suggest a slowdown in economic activity.

CIT, which accounts for a 30% tax on corporate profits, is a major revenue source, alongside a 7.5% Value Added Tax (VAT) on goods and services, according to the Federal Inland Revenue Service (FIRS).

The report also noted that foreign digital companies such as Google, Netflix, and Meta contributed significantly to the tax pool under Nigeria’s digital tax regime.

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These firms, operating in areas like social media, video streaming, and digital content services, are now subject to taxation by the FIRS.

However, the economic situation has affected these companies’ performance. Netflix, for instance, reported reduced patronage due to the impact of inflation on consumers’ spending power.

A very close source to Netflix, while noting that the company remained committed to Nigerian stories, said the company was adjusting its investment strategy and becoming more selective in licensing local content because of economic challenges.

VAT revenue also saw a significant rise, increasing by 157% year-on-year to ₦1.28 trillion, up from ₦498.3 billion during the same period in 2023.

Combining VAT and CIT, Nigeria earned ₦3.85 trillion from foreign companies in the nine-month period, showing a 68.1% surge compared to ₦2.29 trillion in 2023.