It began as a bold vision that many Nigerians dismissed as too ambitious or impossible to achieve. But after months of deliberation, stakeholder consultations, and nationwide debates, Nigeria has crossed a major threshold in its fiscal history. In a landmark moment at the Presidential Villa in Abuja, President Bola Tinubu signed into law four critical pieces of tax reform legislation that experts believe will transform the nation’s revenue system and economic outlook for generations to come.
The signing ceremony was witnessed by governors, ministers, top legislative leaders, and senior government aides. The four bills that received presidential assent include the Nigerian Tax Bill, the Nigerian Tax Administration Bill, the Nigerian Revenue Service Establishment Bill, and the Joint Revenue Board Establishment Bill. These bills are the outcome of months of hard work and represent what many regard as the most debated and consequential tax legislation in Nigeria’s recent democratic experience.
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At the center of this national effort is the Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms and a former Africa Tax Leader at PwC. For him, the day was not just about the signing of laws, but a celebration of what can be achieved when citizens commit to building a better nation. With humility and emotion, Oyedele reflected on the journey and declared, “This shows that possibilities can happen anywhere, including Nigeria. We have changed the rules. We have changed some of the misgivings. We have opened the door for a new economy.”
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However, the road to reform was far from smooth. Oyedele and his team were tasked not only with designing tax policies but also with leading their implementation. This marked the first time in Nigeria’s history that a government committee was given dual responsibility to both develop and implement national fiscal policy recommendations. According to Oyedele, this made a significant difference. “When the controversy reached its peak, I realized that if all we had done was submit our recommendations and move on, none of the reforms would survive. Being involved in implementation made all the difference.”
He went on to reveal the personal sacrifices he made to lead the reforms. He declined to collect any salary for his role on the committee, opting instead to serve Nigeria on a voluntary basis. But the cost was more than financial. His family endured media attacks and false stories, and the emotional toll of being in the public eye was intense. “If Nigerians truly want a better country, they must stop discouraging honest people who are trying to help,” he said. “Public service is not easy, but it is necessary.”
Oyedele emphasized that the goal of the reform was not to raise taxes, but to build a tax system that is fair, transparent, growth-oriented, and supportive of the nation’s development goals. “We are not trying to collect more from the struggling majority,” he said. “We want Nigerian companies to become multinationals, creating jobs and contributing billions to the country. That is how you stabilize the economy.”
A core part of the reform focuses on tax equity. The new legislation introduces a progressive tax system that exempts the poorest Nigerians from tax, reduces the burden on middle-income earners, and increases the contribution required from high-income earners. Oyedele explained that the committee had to rethink the definition of poverty, choosing a more localized benchmark over global standards. The World Bank’s metric of $2.15 per day, he said, does not reflect Nigeria’s unique socio-economic realities. “There are people who earn less than $2 per day but are not necessarily poor, because they grow their own food and don’t need to pay for housing or transport,” he said.
Based on the committee’s analysis, a Nigerian household of five, with two income earners, needs to earn at least ₦250,000 per month to meet basic needs without luxuries. That figure became the basis for drawing the poverty line and informed the decision to exempt low-income earners from taxation under the new laws. “This law will not necessarily give the poor money, but at least it will stop taking from those who have too little to begin with,” Oyedele said.
He acknowledged public fears that the reforms would weigh heavily on the middle class. However, he clarified that the reforms had been structured carefully to reduce taxes for this group. According to the committee’s estimates, Nigerians earning between ₦1.8 million and ₦2 million monthly fall within the middle-income bracket and will experience a reduction in their tax obligations. “It is not zero, but it is lower than what they are currently paying,” Oyedele said.
The reform also seeks to drive efficiency in tax collection. Nigeria currently collects only about 30 percent of its potential tax revenue. With better systems, digital tools, and improved compliance, the country can double its revenue without raising taxes. “We do not need to increase rates,” Oyedele stated. “We just need to ensure that those who are supposed to pay are actually paying.”
A major change introduced in the reform is the replacement of the Federal Inland Revenue Service with the Nigeria Revenue Service. This new agency will collaborate closely with state governments and deploy digital technology to track residency, income, and economic activity. Using data from the National Identity Number, bank transactions, utility records, and investment accounts, tax administrators will be able to better estimate individual earnings and close the tax gap. “We want to get to a point where we don’t need to ask how much you earned,” Oyedele said. “We will tell you what you earned based on the data, and then you can confirm or contest it. That is how modern societies operate.”
Oyedele also drew attention to global comparisons. He highlighted that South Africa, with a population of less than 80 million people, generated over ₦50 trillion from personal income taxes in 2023. In contrast, Nigeria, with over 200 million people, collected only ₦1.5 trillion in personal income tax that same year. “This is more than a gap,” he said. “It is a wake-up call.”
South Africa’s success, he explained, lies in its progressive tax structure. The country exempts people earning less than ₦600,000 per month from personal income tax, and its top 1 percent of earners contribute nearly 90 percent of total personal income tax revenue. “We are learning from global examples and adapting them to our context,” Oyedele said. “That is how nations develop.”
Beyond tax collection, the committee has also developed a Nigeria Fiscal Policy Framework, which will guide broader economic policymaking. This includes matters such as inter-governmental revenue sharing, social safety nets, climate financing, subsidy restructuring, and economic inclusion. “What we are doing is building the foundation for a stronger, fairer economy,” Oyedele said. “This is about more than taxes. It is about national transformation.”
He acknowledged that not everyone will understand the reforms right away. Misinformation and conspiracy theories have been some of the toughest challenges he and his team faced. From rumors that the federal government would collect a quarter of all farm produce, to claims that the North would be unfairly targeted, Oyedele said the reforms were widely misrepresented in the early days. “People believed things that were not in the law,” he said. “But we took the time to explain, to clarify, and to win the confidence of our stakeholders.”
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According to Oyedele, the state that might see a temporary reduction in VAT revenue is Lagos, not any of the northern states as had been falsely reported. “That is why we began our consultations with Lagos State. And to their credit, they understood and supported the bigger picture.”
As Nigeria embarks on this bold new chapter of fiscal reform, Oyedele says he remains hopeful and grateful. “Even with all the challenges, I would do it again,” he said. “I love Nigeria. And if anything happens to me today, I want history to record that there was a man who tried to help his country.”
The message he wants every Nigerian to remember is simple. “This is not about collecting more from the struggling majority,” he said. “It is about fairness. It is about building a tax system where everyone contributes according to their means and everyone benefits from the nation’s progress.”
