The recently enacted tax law, signed by President Bola Ahmed Tinubu, is a “people-centric” reform designed to foster transparency, efficiency, and economic growth, rather than simply boosting government revenue.

This was the assertion of Mr. Taiwo Oyedele, Chairman of the Presidential Fiscal Policy and Tax Reform Committee, during a televised interview on Wednesday.

Addressing mounting public concerns about the implications of the new tax legislation, Oyedele emphasized that the reforms are geared towards creating a fairer system that supports the average Nigerian and strengthens national development.

“It’s already a tough decision to work in the public sector, and making it harder than it needs to be is not helpful,” Oyedele stated. “This reform is about encouraging honest Nigerians and eliminating systemic obstacles.”

Oyedele acknowledged that while the current tax system is functional, it suffers from a lack of transparency and accountability, which erodes public trust. “Usually, when people are hiding things, it becomes hard to trust them,” he observed.

He explained that the new law tackles this by establishing clear standards for timely and accessible reporting through institutions such as the Nigerian Revenue Service (NRS), the Ministry of Finance, and with enhanced oversight by the National Assembly.

Reaffirming that the primary objective is not to increase the tax burden on citizens, Oyedele cautioned against the misconception that reform automatically translates to higher taxation.

“If your primary objective in an economy like ours is to raise revenue, then you’re putting the cart before the horse. Tax revenue should be the consequence of robust economic activity—not its starting point,” he explained. He underscored that taxes must serve as tools to improve public welfare and should not distort economic activities or diminish the quality of life for citizens.

Oyedele outlined three core principles guiding the ambitious reform: The law aims to eliminate taxation on poverty, protect small businesses, and support the growth of large enterprises. “We want Nigerian companies to evolve into multinationals. That way, when oil prices drop, we don’t panic,” he said.

By identifying and correcting inefficiencies in tax collection and public spending, the reform seeks to significantly reduce waste. “We need to plug the leakages,” Oyedele stated.

With a vision to transform Nigeria into a $2 trillion economy, Oyedele stressed that a stronger, more productive economy would naturally expand the tax base. “Even collecting just 10% of GDP would give us far more than we collect today,” he added.

Battling Tax Evasion with Data Integration

A significant source of untapped revenue, according to Oyedele, lies in curbing widespread tax evasion. He revealed that Nigeria currently collects only 30% of its potential tax revenue, with the remaining 70% lost to evasion.

“There are people earning more than you who pay no taxes at all. That’s unfair, and it must stop,” he asserted.

He elaborated that the new system will leverage data integration—pulling information from sources such as the National Identification Number (NIN), bank accounts, phone records, property ownership, and travel history—to detect and prevent evasion. “You travel, buy land or a car, build a house—we have that data. You can’t hide anymore,” he warned.

Under this new framework, the government will use digital records to assess earnings and notify taxpayers, rather than solely depending on self-reported income. “We’ll tell you how much you earned in 2025; it will be up to you to dispute or confirm it,” he added.

Oyedele also confirmed that the transition from the Federal Inland Revenue Service (FIRS) to the Nigerian Revenue Service (NRS) signifies a major shift towards digitization and intergovernmental collaboration.

“You can’t claim to reside in the FCT when your phone data shows you live and work in another state,” he noted, explaining that the system will help eliminate fraudulent residency claims and ensure accurate tax distribution.

Furthermore, the digital framework will assist in identifying and exempting the genuinely poor from taxation, reinforcing what Oyedele described as a “pro-poor, pro-business, pro-growth, and pro-equity policy.”

As Nigeria embarks on the implementation of this ambitious tax reform, Oyedele reiterated that the focus remains firmly on building a transparent, inclusive, and growth-driven fiscal framework for the nation’s future.