Nigeria’s mining and quarrying industry recorded a significant boost in tax contributions, generating N686.96 billion in Value Added Tax (VAT) in 2025, highlighting the sector’s growing importance to government revenue and the broader economy.
The latest figures reflect increased activity in the extractive industry and improved tax compliance across the sector. The rise in VAT contributions also signals ongoing efforts by authorities to strengthen non-oil revenue sources, especially as Nigeria continues to reduce its dependence on crude oil earnings.
Data from the National Bureau of Statistics indicate that mining remains one of the key contributors to VAT collections, alongside manufacturing and information and communication. These sectors have consistently driven tax revenue growth due to their strong link to production, services, and consumption within the economy.
The report noted that “Nigeria’s mining sector records N686.96 billion VAT contribution in 2025”, underscoring the scale of revenue generated from mineral extraction and related activities. This performance places the sector among the top revenue-generating industries in the country.
Industry analysts attribute the growth to increased formalisation of mining operations, improved monitoring by regulatory agencies, and rising investments in solid minerals. The government has also intensified efforts to block revenue leakages and ensure that operators comply with tax obligations.
In addition, the expansion of local production and rising global demand for certain minerals have contributed to higher transaction volumes, which in turn boost VAT collections. As more mining companies enter the formal economy, the tax net continues to widen.
Nigeria’s VAT system remains a critical source of funding for all tiers of government. Higher collections are often linked to stronger economic activity and better compliance mechanisms. In recent reports, VAT revenue has shown steady growth, reaching trillions of naira quarterly, with mining playing a notable role in the overall mix.
Despite this progress, experts believe there is still significant untapped potential in the mining sector. Challenges such as illegal mining, inadequate infrastructure, and limited access to financing continue to affect optimal performance. Addressing these issues could further increase the sector’s contribution to national revenue.
Stakeholders have called for more investment in geological data, improved licensing processes, and stronger enforcement of regulations to sustain the growth momentum. They also emphasise the need for policies that encourage private sector participation while ensuring environmental and community standards are upheld.
The steady rise in VAT contributions from mining highlights a gradual shift in Nigeria’s revenue structure, with non-oil sectors gaining prominence. If properly managed, the mining industry could become a major pillar of economic diversification and fiscal stability in the coming years.
Overall, the N686.96 billion VAT contribution recorded in 2025 reflects both progress and potential, positioning the mining sector as a key driver of Nigeria’s evolving economic landscape.
