Manufacturing Tax Payments Drop 68% in Q1 2026

In the first quarter of 2026, manufacturing companies in Nigeria reported a significant decline in corporate income tax payments, dropping 68.25% year-on-year to ₦74.48 billion from ₦234.59 billion in Q1 2025. This decline has raised concerns regarding the manufacturing sector's capacity to withstand the new tax regime, which coincided with weak consumer demand and elevated operational costs.

The National Bureau of Statistics indicated that the total corporate income tax collected in Q1 2026 was ₦1.37 trillion, reflecting an 8.08% decrease from ₦1.49 trillion in Q4 2025. Despite the sharp decline in manufacturing tax payments, the sector remains one of the three largest contributors to domestic corporate income tax, accounting for 13.82% of the total.

The new tax framework, signed into law by President Bola Tinubu, reduced corporate income tax from 30% to 25%, aiming to support small and medium enterprises. However, the manufacturing sector continues to face challenges such as high energy costs and logistical constraints.