Nigeria’s Tax Revenue Rises to ₦21.6 Trillion in H1 Amid Reform Push

Nigeria’s tax reform drive is beginning to show stronger revenue numbers, with the Nigeria Revenue Service generating ₦21.6 trillion in the first half of 2026.

The figure represents a 49 percent year-on-year increase and comes as the Federal Government pushes wider tax reforms, digital tax administration and tighter control over oil revenue remittances. The performance was contained in the Economic Snapshot Report 2023 vs 2026, obtained by The PUNCH from the Presidency.

According to the report, Nigeria’s total tax collections rose from ₦12.3 trillion in 2023 to ₦21 trillion in 2024 and ₦28.3 trillion in 2025. The ₦21.6 trillion collected in the first six months of 2026 shows that the revenue agency is on a faster path than previous years.

Why the ₦21.6tn Revenue Figure Matters

The new figure matters because Nigeria has been trying to reduce its dependence on borrowing and improve domestic revenue mobilisation.

For years, Nigeria has struggled with low tax-to-GDP, weak compliance, leakages in public revenue collection and heavy dependence on oil earnings. The latest data suggests that reforms under the Nigeria Revenue Service are beginning to expand the country’s revenue base.

The report said non-oil revenue accounted for 76 percent of total collections, while Nigeria’s tax-to-GDP ratio improved from 10.3 percent to 13 percent.

That is important because a stronger non-oil revenue base gives the government more room to fund infrastructure, education, healthcare, security and debt obligations without relying too heavily on crude oil exports.

Digital Tax Tools Are Changing Collection

A major driver of the revenue increase is the digitalisation of tax administration.

The report credited tools such as the national e-invoicing system, which was rolled out to large taxpayers, as one of the measures improving compliance and collection. Digital tax systems make it harder for taxable transactions to disappear from official records and easier for the government to track what companies should pay.

This is one of the biggest shifts in Nigeria’s tax administration. The more transactions move into digital tax systems, the easier it becomes to reduce under-reporting, improve audits and close compliance gaps.

The FIRS-to-NRS Shift Is Also Key

The report also linked the revenue growth to the transformation of the Federal Inland Revenue Service into the Nigeria Revenue Service.

According to the report, the change expanded the agency’s mandate by bringing in some non-tax revenue streams that were previously collected by other agencies. This created a more centralised revenue consolidation system.

This matters because fragmented revenue collection has long been a problem in Nigeria. When different agencies collect different types of public revenue with weak coordination, leakages can occur. A centralised model can improve visibility, reporting and enforcement.

Oil Revenue Remittance Reform Boosts Federation Account

Another major factor is Executive Order 9, signed in February 2026.

The report said the order changed the way upstream oil and gas operators remit royalties, taxes and production-sharing-contract profit oil. Instead of allowing deductions before money reaches the Treasury, operators are now required to remit directly and in full to the Federation Account.

The impact was immediate. Monthly Federation Account receipts reportedly rose by 60 percent, from ₦1.8 trillion in February 2026 to ₦2.88 trillion in March 2026.

This is one of the clearest signs that Nigeria’s revenue challenge is not only about raising taxes. It is also about blocking leakages and ensuring that existing revenue reaches the right account.

But Nigeria Still Has a Long Road Ahead

Despite the strong performance, the report said Nigeria’s tax-to-GDP ratio still has room to grow. The government’s long-term target is 18 percent, meaning the current 13 percent level is progress but not the final destination.

The report also recommended that the Presidency and the NRS seek legislative backing for Executive Order 9. This would help preserve the gains in Federation Account revenues beyond the lifespan of the executive order.

That recommendation is important. Executive orders can move policy quickly, but laws create stronger permanence. If the government wants the gains from oil remittance reforms to last, it may need to embed them in tax or petroleum legislation.

Expert View: Strong Revenue Is Good, But Trust Still Matters

From a business and fiscal policy perspective, the ₦21.6 trillion half-year collection is a strong signal. It shows that Nigeria can raise more money when tax systems are digital, loopholes are closed and revenue collection is better coordinated.

However, higher collections must come with stronger public trust. Businesses and citizens are more likely to comply when they can see that tax revenue is used well. If taxpayers only see higher enforcement without better public services, the reform may face resistance.

The government’s real test is not just collecting more money. It is proving that the money can translate into better roads, stronger public institutions, improved social services and a more stable economy.

What Happens Next

The NRS has set a ₦40.7 trillion revenue target for 2026. That target is about 44 percent higher than the ₦28.29 trillion collected in 2025 and reflects the government’s push to expand compliance, strengthen automation and reduce borrowing pressure.

If the agency sustains its first-half momentum, Nigeria could record one of its strongest revenue years yet. But the result will depend on full implementation of the new tax laws, wider e-invoicing coverage, better enforcement and continued compliance from oil and non-oil taxpayers.

FAQs

How much did the Nigeria Revenue Service generate in the first half of 2026?

The Nigeria Revenue Service generated ₦21.6 trillion in the first six months of 2026.

What caused the increase in tax revenue?

The increase was driven by tax reforms, digital tax administration, the FIRS-to-NRS transformation, e-invoicing and changes to oil revenue remittances.

What percentage of collections came from non-oil revenue?

According to the report, non-oil revenue accounted for 76 percent of total collections.