Nigerian banks and their holding company (Holdco) financial institutions puffed-up the federal government treasury with about N70billion they paid as income taxes in first-half (H1) of 2015, BusinessDay checks at the Nigerian Stock Exchange (NSE) reveal.
This amount paid as income taxes by listed banks represents about 14 percent of over N500billion which the Federal Inland Revenue Service (FIRS) actually collected as company income tax (CIT) as at June 2015.
Government imposes income tax on financial income generated by all entities within its jurisdiction. By law, businesses and individuals file an income tax return to determine whether they owe any taxes or are eligible for a tax refund.
The federal government’s revenue agency had a 2014 government monthly target of N80.631billion for company income tax, but recorded an actual collected of N501.65billion, an increase of 67.23 percent.
Inspite of harsh economic headwinds and regulatory changes that impacted the financial industry, many banks showed strength in their earnings and remained on stable growth trajectory, as they implemented initiatives to grow their core banking segments.
Bank statements to the Nigerian Stock Exchange (NSE) and shareholders on their half year results for the period ended June 30, 2015 show that Access Bank plc paid N7.82billion as income tax, an increase of 94% compared with N4.04 billion the bank paid in the corresponding H1 period of last year.
The bank earned N168.642 billion in the half year period, an increase of 43% when compared with N117.932 billion in H1’14.
Sterling Bank plc paid N630 million as income tax, a decline of 29.74% when compared with N896.8 million income tax payment in H1’14. Sterling Bank plc earned N55.042 billion in H1’2015, an increase of 11.45% from H1’14 level earnings of N49.386 billion.
The half-year 2015 income tax payment made by Zenith Bank plc was N19.021billion, up from H1’14 level of N10.414 billion. Zenith Bank’s H1’15 gross earnings increased to N229.082 billion from N184.435 billion in H1’14.
Skye Bank plc reported 47.4% increase in income tax payment to N2.142 billion, from N1.453 billion in H1’14. The first-half 2015 gross earnings of Skye Bank plc increased by 33.4% to N85.202 billion from N63.884 billion in H1’14.
GTBank plc reported 15% growth in H1’15 gross earnings to N152.995 billion from N132.985 billion in H1’2014. GTBank paid N9.738 billion as taxes in the period an increase of 4% from N9.388 billion in H1’14. Unity Bank plc income tax payment amounted to N877.488 million as against N789.832 million in H1’2014.
The bank’s gross income rose to N33.562 billion in H1’15 from N30.851billion in H1’14. Income tax expense of Wema Bank plc declined to N175.978 million in H1’15 from N721.495 million in H1’14. The gross earnings of Stanbic IBTC Holdings plc rose by 11% to N68.295 billion from N61.715 billion in H1’14.
The holding company financial institution reported 104% decline in half year tax expense to N158million from N3.762 billion in H1’14. FCMB Group plc which reported H1’15 gross earnings increase of 11% to N77.353billion from N69.620billion in H1’14 recorded 19% decline in income tax payment to N1.265billion from N1.563billion in the corresponding first half of 2014.
The income tax expense of FBN Holdings plc rose to N12.025billion in H1’15 from N11.072billion in H1’14. Fidelity Bank plc reported H1’15 gross earnings of N71.890billion from N63.258billion in H1’14. The income tax expense from continuing operations of the bank was N1.450billion from N1.415billion.
Diamond Bank plc reported H1’15 income tax payment of N2.038billion, down from N2.286billion in the corresponding half year period of 2014, while Ecobank Transnational Incorporated plc paid a naira equivalent of N12.82billion as income tax in the period under review. The Ecobank plc reported N211.325billion gross earnings in H’15 from H’14 in N175.056billion.
Iheanyi Nwachukwu
