In a strategic plan aimed at enhancing revenue collection and redistributing the tax burden, the Federal Government of Nigeria has unveiled plans to revamp the nation’s tax system, with a focus on wealthier citizens. This initiative is part of the government’s broader strategy to achieve an ambitious 18% Tax-to-GDP ratio within a three-year timeframe.
The disclosure came from Mr. Taiwo Oyedele, Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, during a recent interview with Bloomberg. Mr. Oyedele underscored that this reform drive aligns with President Bola Tinubu’s vision for Nigeria’s fiscal policies.
Mr. Taiwo elucidated on the government’s approach, stating, “Our objective is to ensure that the affluent members of society contribute their fair share, while safeguarding the vulnerable. Simultaneously, we envisage a reduction in the corporate income tax rate, currently exceeding 40%, to stimulate business growth.”
Further elaborating on the committee’s strategies, Mr. Taiwo emphasized the adoption of technology to expand the tax base and augment revenue streams. He articulated, “We are committed to designing comprehensive structures and systems for tax imposition, collection, allocation, and accountability. The ultimate goal is to streamline the multitude of taxes into single digits. We have already identified the top eight taxes that generate 99% of revenue, which we intend to retain. The remaining, less effective taxes will be eliminated. By enhancing our knowledge of citizens’ income and location, we can encourage tax compliance, and even offer amnesty for those who haven’t paid their dues.”
The Federal Government’s move towards a fairer and more efficient tax system, combined with leveraging technology, reflects its commitment to fiscal reforms aimed at boosting revenue while ensuring equitable distribution of the tax burden across the nation.
