11 Deposit Money Banks (DMB’s) listed on the Nigerian Stock Exchange (NSE) have reported a total of N64.557 billion in taxes for the first half of the year, 2018.
The banks include Zenith Bank, Guaranty Trust Bank, Ecobank Transnational Corporation (ETI), Stanbic IBTC Group, FBN Holdings, FCMB Group and Diamond Bank.
The figure represents a 13.43 per cent increase from the N56.916 billion paid by the 11 banks in half year, 2017. The 11 banks also reported a total pre-tax profits of about N382.853 billion for the period under review.
Companies Income Tax (CIT) is tax on the profits of incorporated entities in Nigeria. It also includes the tax on the profits of non-resident companies carrying on business in Nigeria. The tax is paid by limited liability companies inclusive of the public limited liability companies. It is therefore commonly referred to as corporate tax.
CIT was created by the Companies Income Tax Act (CITA) 1979 and has its root from the Income Tax Management Act of 1961. It is one of the taxes administered and collected by the Federal Inland Revenue Service (FIRS). Nigeria has a corporate tax rate of 30 per cent.
According to LEADERSHIP findings, Zenith Bank paid the highest tax at about N25.6 billon from a pre-tax profit of N107.358 billion. Guaranty Trust Bank followed with a tax payment of N14.051 billion from a profit before tax of N109.6 billion, while Ecobank Transnational Corporation (ETI) paid tax of N13.707 billion after posting a profit before tax of N65.099 billion.
Stanbic IBTC Groups paid tax of N7.646 billion from a pretax profit of N50.730 billion, FBN Holdings declared a tax of N1.309 billion from a profit after tax of N20.061 billion, FCMB Groups paid tax of N928.833 million from a profit before tax of N1.10 billion and Diamond Bank paid tax of N470 million with a pre-tax profit of N2.9 billion.
Others are Wema Bank, Union Bank of Nigeria, Sterling Bank and Jaiz Bank which paid tax of N244.926 million, N206 million, N149 million and N24.525 million respectively, from a profit before tax of N1.81 billion, N11.664 billion, N6.3 billion and N231.215 million in that order.
The importance of taxation to a nation’s economic wealth and development cannot be overemphasised. However, the achievement of this goal is often undermined by tax evasion and deliberate attempts by multinationals to shift profits from one jurisdiction to another, amongst others.
Over the years, Nigeria has attempted to use taxation […]