At a time where the conversation centres on the need for states to be financially viable away from overdependence on revenue from the government at the centre, the Pay-As-You-Earn income tax according to a recent report from the National Bureau of Statistics, NBS in 3 years, has generated the sum of ₦2.33tn for all 36 states in Nigeria including the FCT.

An interesting insight from the report shows that despite the advent of Covid-19, PAYE collected in 2020 represented the highest since 2018. The analysis is thus; in 2018, states generated ₦669.22bn, in 2019 ₦809.32bn was raked in while 2020 went up to ₦851.73bn.

Experts based on this breakdown has pointed that states need to focus attention on investments that spring up businesses to further increase their PAYE earnings.

According to the statistics, 2020 witnessed the highest PAYE received since 2018

Further Breakdown,

Lagos with ₦788.29bn earned the highest from PAYE in the period under review. Lagos success is not far fetched considering the number of businesses in the economic centre of the nation. This is closely followed by Rivers with ₦255.34bn and the Federal Capital Territory with ₦210.08bn.

Jigawa raked ₦11.74bn, Taraba; ₦10.66bn, and Gombe; ₦9.23bn made the least from PAYE in the period under review.

Ogun earned ₦87.61bn; Akwa Ibom, ₦65.64bn; Oyo, ₦50.89bn; Kano, ₦45.31bn; and Kaduna, ₦42.41bn, according to the NBS data.

From 2018 to 2020, Ondo generated ₦40.47bn from PAYE; Edo, ₦39.30bn; Enugu, ₦38.22bn; Bayelsa, ₦37.09bn; Imo, N32.08bn; Plateau, N31.55bn; Anambra, ₦30.68bn; Bauchi, ₦30.06bn; Kogi, ₦29.92bn; Benue, ₦28.77bn; Kwara, ₦25.03bn; and Osun, ₦24.32bn.

In the period under review, Nasarawa earned ₦23.23bn from PAYE; Katsina, ₦23.10bn; Cross River, ₦21.64bn; Sokoto, ₦20.85bn; Abia, ₦19.04bn; Niger, ₦18.13bn; Zamfara, ₦17.24bn; Borno, ₦16.90bn; and Adamawa, ₦15.29bn.

Ebonyi generated ₦14.51bn; Yobe, ₦14.39bn; Ekiti, ₦12.82bn; Kebbi, ₦12.29bn; Jigawa, ₦11.74bn; Taraba, ₦10.66bn, and Gombe, ₦9.23bn.

Regional Breakdown

  • The South-West earned ₦1.0tn from PAYE in the three years under review, making it the region with the highest PAYE earnings.
  • The South-South is the region with the second-highest PAYE earnings, as it got ₦555.14bn from 2018 to 2020.
  • The North-Central earned ₦366.71bn from PAYE, making it the region with the third-highest PAYE earnings.
  • The North-West generated ₦172.95bn, South-East; ₦134.53bn), and North East; ₦96.54bn earned the lowest from PAYE in the period under review.

What you should know

  • Personal Income Tax is imposed on the income of individuals, corporate sole or body of individuals, communities, families, and trustees or executors of any settlement.
  • The tax is guided by the amended Personal Income Tax Act Cap P8 LFN 2004.
  • This tax ranges from 7 percent to 24 per cent, depending on the amount of chargeable income.
  • Remittance of PAYE is the 10th day of every new month.
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