Business - 2 hours ago

Nigeria Must Expand Tax Base, Not Raise Tax Rates – Oyedele

Nigeria’s Finance Minister, Taiwo Oyedele, says the country does not need higher taxes. Instead, it needs more people and businesses inside the tax system.

He made this known in Abuja during a meeting with the Chartered Institute of Taxation of Nigeria. The discussion followed a national tax awareness campaign.

Oyedele said Nigeria’s biggest challenge is not tax rates. It is weak compliance and a narrow tax base.

Government Push for Wider Tax Compliance

The minister explained that many Nigerians misunderstand taxation. He said people often assume every tax reform is about collecting more money.

He stressed that the real goal is fairness. More citizens should contribute, while existing taxpayers should not carry the burden alone.

He also said stronger compliance would improve national revenue without increasing pressure on individuals or businesses.

Tax Awareness Campaign Targets Market Traders

The Chartered Institute of Taxation of Nigeria supported the government’s message through a public awareness campaign.

The campaign began at Wuse Market in Abuja. It included outreach activities, a road walk, and taxpayer education sessions.

The group also visited the Nigerian Revenue Service headquarters. The aim was to improve understanding of Nigeria’s recent tax reforms.

One Year After Major Tax Reforms

The campaign marked one year since President Bola Tinubu signed new tax reform laws in June 2025.

According to officials, the reforms were designed to simplify taxation and improve fairness in the system.

However, many taxpayers still struggle to understand the changes and how they affect businesses and individuals.

Reliefs and Incentives in the Tax System

Tax officials highlighted several benefits under the new system.

Individuals can claim rent relief of up to 20 percent of annual rent, capped at ₦500,000. Essential goods and services such as food, education, healthcare, electricity transmission, and non-oil exports are now zero-rated for VAT.

Small businesses also benefit. Companies with annual turnover below ₦100 million and limited assets are exempt from major taxes, including Company Income Tax and Capital Gains Tax.

Sector-specific incentives also apply to agriculture, dairy production, cocoa processing, and aquaculture.

Compliance Still a Legal Duty

Despite the incentives, tax authorities insist compliance remains mandatory.

Officials said taxation is a civic responsibility that supports national development. They also stressed that trust between citizens and government is key to improving tax collection.

Taxpayers were urged to register, keep proper records, and file returns on time.

Digital Push for Tax Administration

The Nigerian Revenue Service is also expanding its digital systems.

Platforms like Rev360 are being introduced to improve efficiency and reduce manual processes. The goal is to make tax administration more transparent and easier for taxpayers.

Officials say technology will play a key role in expanding compliance across the country.

Expert View

Nigeria’s tax challenge is structural, not just policy-driven.

The country has a large informal economy. Millions of traders, small businesses, and self-employed workers operate outside the formal tax system.

Expanding the tax net is often more effective than increasing rates. When more people contribute small amounts, total revenue rises without overburdening existing taxpayers.

However, success depends on trust. Citizens are more likely to comply when they see visible public services and transparent spending.

Without that trust, enforcement alone will not close the gap.