President Bola Tinubu is considering a major overhaul of Nigeria’s revenue collection system by introducing a new agency, the Nigeria Revenue Service, which would take over revenue collection duties from all current revenue-generating agencies.
A tax reform initiative aimed at improving efficiency and increasing the nation’s tax-to-GDP ratio.
The proposed reforms would prevent over 60 agencies, including the Nigerian Customs Service and Nigerian Ports Authority, from collecting revenues on behalf of the Federal Government.
Instead, the Nigeria Revenue Service would handle all government revenue collection duties.
This move, announced as part of four executive bills sent to the National Assembly, is intended to boost tax collection, reduce inefficiencies, and improve public service funding.
Among the bills is the Nigeria Revenue Service (Establishment) Bill, which seeks to rename and restructure the Federal Inland Revenue Service (FIRS) into the Nigeria Revenue Service.
This agency will be responsible for assessing, collecting, and accounting for all government revenues, ensuring a consolidated and efficient process.
This reform aligns with the government’s goal to raise Nigeria’s tax-to-GDP ratio to 18%, up from one of the lowest levels in the world.
In addition to the establishment of the Nigeria Revenue Service, Tinubu proposed three other tax reform bills under the banner of “Transmission of Fiscal Policy and Tax Reform Bills.” These include the Nigeria Tax Bill, which consolidates the country’s fiscal framework, and the Nigeria Tax Administration Bill, which aims to streamline tax compliance.
The Joint Revenue Board Establishment Bill proposes creating a Tax Tribunal and Tax Ombudsman to resolve disputes and enhance transparency in tax administration.
The reforms, designed by the Taiwo Oyedele-led Presidential Fiscal Policy and Tax Reforms Committee, aim to protect small businesses and vulnerable groups while ensuring that wealthier citizens contribute more.
The committee also seeks to reduce the number of taxes from 62 to a maximum of nine, a measure expected to enhance the country’s fiscal sustainability and support economic growth.
However, some stakeholders have voiced concerns. Dr. Eugene Nweke, a former president of the National Association of Government Approved Freight Forwarders, argued that customs agencies worldwide are traditionally responsible for revenue collection.
He warned that outsourcing this function could introduce complications. Similarly, Taiwo Fatobilola, a representative of the Association of Registered Freight Forwarders of Nigeria, criticized the plan, questioning the practicality of transferring such a complex function to a new agency.