The Nigerian Government has set a target of raising Nigeria’s tax-to-GDP ratio to 18 per cent by 2028 as part of efforts to strengthen domestic resource mobilisation and improve funding for critical sectors of the economy.
The Special Adviser on Revenue to the Minister of Finance and Coordinating Minister of the Economy, Olarinde Michael Olufemi, stated this at the GS-26 plenary in Abuja, themed: “From Tax Reforms to Last-Mile Impact: Building an Inclusive Fiscal Architecture.”
Olufemi said the government was committed to strengthening domestic resource mobilisation, noting that Nigeria’s tax-to-GDP ratio remained among the lowest globally and below the African average.
He stressed that increased revenue must translate into improved healthcare, education, infrastructure, security, social protection and other essential services.
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“We don’t want to be collecting taxes from just a few individuals or a few businesses. We need to broaden the tax base and ensure that everyone pays their fair share,” Olufemi said.
The Special Adviser explained that broadening the tax base would require bringing more individuals and businesses into the formal economy through improved taxpayer identification, digital compliance and simplified tax administration.
He stressed that expanding the tax net should not impose heavier burdens on existing taxpayers, but should make compliance simpler, more transparent and equitable.
Olufemi said Nigeria’s projected population of about 400 million by 2050, alongside rising debt obligations, infrastructure gaps, unemployment, rapid urbanisation and climate-related challenges, made sustainable domestic revenue mobilisation imperative.
He identified healthcare, education, infrastructure, security and social protection as priority areas requiring dependable financing.
According to the Special Adviser, an inclusive fiscal architecture should be built around fair revenue mobilisation, digital collection systems, simplified compliance procedures, equitable budget allocation, value-for-money expenditure and stronger citizen engagement.
“Ultimately, citizens must see the impact of the resources that government collects,” Olufemi emphasised.
Stakeholders at the session called for incentives and support to enable informal businesses to formalise without excessive compliance costs.
They identified poor record-keeping, limited access to finance, inadequate information and complex regulatory requirements as some of the factors keeping businesses outside the formal economy.
The participants urged banks, business associations and large corporations to support small businesses with accounting systems, advisory services and digital invoicing platforms to improve financial records, access to credit and tax compliance.
They also identified multiple taxation, inadequate taxpayer awareness and digital exclusion as challenges to the reform process.
The stakeholders called for harmonised taxes, intensified taxpayer education and digital systems that would accommodate citizens and businesses with limited access to internet services and technology.
They further urged greater transparency, open data and independent monitoring, calling on government agencies to demonstrate what revenue is collected, how it is allocated and its impact on public spending.
The stakeholders maintained that the success of fiscal reforms should be measured not only by revenue growth, but also by increased formalisation, lower compliance costs and visible improvements in roads, security, education, healthcare and Nigerians’ quality of life.
