A significant shift occurred in the Nigerian corporate tax landscape in 2024, marked by a substantial increase in the current tax liabilities of thirteen prominent companies. The aggregate current tax liability for these companies surged by 50.54%, reaching N210.52 billion, a considerable leap from the N139.85 billion recorded in 2023. This substantial increase underscores the interplay between prevailing economic conditions, corporate earnings, and the resultant tax obligations of businesses operating within Nigeria. Current tax liabilities, representing the taxes owed for the current financial period, encompass corporate income tax and other statutory tax obligations due within the year. These liabilities have a direct impact on a company’s cash flow and overall financial stability, making their management a crucial aspect of financial planning and sustainability.
The surge in tax liabilities is evident across a diverse range of sectors, including financial services, food processing, brewing, energy, manufacturing, pharmaceuticals, real estate, and printing. Leading the pack with the highest tax liability was VFD Group, experiencing a dramatic increase to N154.11 billion in 2024 from N103.19 billion in 2023. This substantial rise suggests a significant increase in the group’s taxable income, potentially driven by successful business ventures and favorable market conditions. Other companies demonstrating notable increases include TotalEnergies Marketing Nigeria Plc, whose tax liabilities tripled to N13.90 billion, and Honeywell Flour Mills Plc, which experienced a nearly five-fold increase to N3.85 billion. These figures highlight the dynamic nature of the business environment and its impact on tax obligations.
Bua Foods maintained a relatively stable tax liability, recording N16.04 billion in 2024 compared to N16.01 billion in 2023. This consistency suggests a steady performance and predictable tax obligations for the company. Nigerian Breweries Plc also experienced a substantial increase, with its tax liability rising to N10.40 billion, suggesting growth in its operations and profitability. Conoil and MRS Oil Nigeria Plc, both operating in the oil and gas sector, also saw increases in their tax liabilities, reflecting the performance of the sector and the associated tax implications.
Several other companies, while experiencing smaller increases in absolute terms, demonstrated significant percentage growth in their tax liabilities. Fidson Healthcare, for instance, saw its liability rise to N2.50 billion, a substantial increase from the previous year. Similarly, UPDC Plc, Berger Paints Nigeria Plc, and Academy Press all recorded increases in their current tax liabilities, reflecting their respective financial performance and the prevailing tax regime. These increases, albeit smaller than those of the leading companies, still contribute to the overall growth in current tax liabilities observed across the thirteen companies.
Interestingly, not all companies experienced increased tax liabilities. Neimeth International Pharmaceuticals Plc and FTN Cocoa Processors Plc recorded decreases in their tax obligations, indicating potential challenges in their respective sectors or strategic tax planning measures. Neimeth’s liability decreased to N56.33 million, while FTN Cocoa Processors Plc recorded the lowest tax liability among the group at N46.07 million. These reductions, while contrasting with the general trend, highlight the diverse performance and financial strategies within the Nigerian corporate landscape.
The analysis of these thirteen companies provides valuable insights into the evolving tax landscape in Nigeria. The significant increase in current tax liabilities underscores the impact of economic factors, corporate earnings, and statutory regulations on businesses operating in the country. The data derived from their 2024 financial statements offers a snapshot of their financial health and their commitment to fulfilling their tax obligations. This information is crucial for investors, regulators, and other stakeholders in understanding the financial performance and sustainability of these companies. Furthermore, it highlights the importance of effective tax planning and management for businesses to navigate the complexities of the Nigerian tax system and ensure long-term financial stability.
