Nigeria’s Tax-to-GDP Ratio Rises by 10.86%

Nigeria’s tax-to-GDP Ratio grew by 10.86 percent as at the end of 2021, the Federal Inland Revenue Service in the country has said.

A statement signed by Johannes Wojuola, the Special Assistant to the FIRS Executive Chairman, Mohammed Nami, said that the growth was derived following an analysis of data from 2010 to 2021.

The statement further indicated that the data was polled in a joint effort among sister agencies including the Statistician-General’s office, Nigerian Bureau of Statistics, with the federal ministry of Finance, and the FIRS.

Tax-to-GDP ratio is a measure of a nation’s tax revenue relative to the size of her economy, as measured by Gross Domestic Product.

“The ratio is a useful tool for assessing the ‘heath’ of a country’s tax system, and highlighting its tax potentials relative to the size of the economy.

“It is the ultimate measure of the effectiveness of a nation’s tax system compared to other countries,” the statement explained.

The FIRS called on the government to consider the review of its policies on tax waivers adding it would guarantee increased revenue for the country.

Full statement