Minister of Finance Taiwo Oyedele has warned that Nigeria must transition away from its heavy reliance on borrowing to fund national development.
Speaking at a tax conference in Abuja, he emphasized that the current trajectory is unsustainable and that the nation must instead build a fiscal system capable of independently supporting infrastructure, education, and healthcare.
While the government is currently negotiating a $1.25bn loan from the World Bank for economic reforms, Oyedele clarified that long-term stability requires more than just revenue.
He argued that true sustainability must foster economic growth, bridge the gap of inequality, and provide a robust safety net for the country’s most vulnerable populations. Central to this shift is a comprehensive overhaul of the tax system to address structural flaws.
The Minister highlighted issues such as fragmented administration and “multiple taxation,” which have historically burdened businesses with unpredictable enforcement and high compliance costs, leading to a widespread perception of unfairness among citizens.
To restore public trust and ease the cost of living, the government has introduced significant tax reliefs. Minimum wage earners are now exempt from personal income tax, and additional concessions have been granted to low- and middle-income households.
Furthermore, planned reductions in corporate tax and VAT reforms aim to curb inflation and stimulate investment. Operational efficiency is also being prioritized through the “harmonization” of taxes across various levels of government. So far, 15 states have adopted laws to reduce overlapping levies, a move intended to simplify the business environment and create a more predictable fiscal landscape for local and international investors.
Looking ahead, Oyedele stated that the future of Nigerian tax administration will be defined by technology. By integrating digital systems, automation, and advanced data analytics, the government aims to improve compliance and broaden the tax base without increasing the financial pressure on compliant citizens and businesses.
