Mining sector records N686.96bn VAT contribution in 2025, says NBS

The National Bureau of Statistics (NBS) has disclosed that Nigeria’s mining and quarrying sector remitted a total of N686.96 billion in Value Added Tax (VAT) in 2025.

The figure represents a notable increase from the N556.19 billion recorded in 2024, reflecting improved tax compliance and revenue mobilisation within the sector.

The latest data highlights growing fiscal contributions from a sector that has historically underperformed in Nigeria’s economy.

Despite the improvement, the sector continues to face structural challenges that limit its overall economic impact. NBS data shows that VAT contributions from the mining sector remained relatively stable throughout 2025.

The sector generated N187.59 billion in Q1, representing the highest quarterly contribution.

VAT collections declined to N164.70 billion in Q2. The sector recorded N167.90 billion in Q4, indicating consistent performance in the latter half of the year.

The steady quarterly trend demonstrates stable revenue inflows despite broader economic pressures.  Nigeria’s mining sector has long struggled to realise its full potential despite abundant mineral resources.

The sector contributes less than five per cent to Nigeria’s Gross Domestic Product (GDP).

Illegal mining activities have significantly reduced government revenue.

Weak incentives, poor infrastructure, and policy gaps have discouraged large-scale investments.

These challenges have limited the sector’s contribution to both economic growth and government revenue.

Recent fiscal reforms have played a key role in improving revenue collection in the mining sector.

In June 2025, President Bola Ahmed Tinubu signed four major tax reform laws to modernise Nigeria’s tax system.

The reforms include the Nigeria Tax Bill, Nigeria Tax Administration Bill, Nigeria Revenue Service (Establishment) Bill, and Joint Revenue Board (Establishment) Bill.

A key policy shift transferred the collection of mineral royalties to the Nigeria Revenue Service (NRS) to improve accountability.

The Federal Government also generated N6.96 billion in mining fees in Q1 2025, indicating improved compliance.

These measures are aimed at reducing leakages and strengthening revenue administration across the sector.