FG Pushes Tax Reforms as Oyedele Warns Against Rising Debt Dependence

The Federal Government has renewed its push for comprehensive tax reforms as authorities seek to strengthen Nigeria’s fiscal position and reduce the country’s heavy reliance on borrowing to finance development projects and public services.

Speaking at the annual conference of the Chartered Institute of Taxation of Nigeria in Abuja, Nigeria’s Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele said the country must build a more sustainable revenue structure capable of supporting long-term economic growth without excessive dependence on debt.

Oyedele stated that Nigeria’s current fiscal realities require deeper reforms that can improve government revenue generation while encouraging investment, productivity and economic expansion.

According to the minister, the administration’s tax reform agenda is designed to simplify the nation’s tax structure, reduce inefficiencies and create a more business-friendly operating environment for investors and companies.

He noted that the country’s tax system has struggled for years with overlapping levies, fragmented administration, weak compliance and limited revenue sources, creating pressure on public finances and increasing dependence on external and domestic borrowing.

The minister explained that sustainable fiscal management goes beyond raising taxes, stressing that reforms must also promote fairness, economic inclusion and protection for vulnerable citizens.

Oyedele disclosed that the ongoing reforms include measures aimed at easing the tax burden on low-income earners while improving efficiency within the overall system.

He added that minimum wage earners have been exempted from personal income tax under the new framework, while reforms are also targeting reductions in compliance costs for businesses operating across multiple states.

On corporate taxation, the minister said the government was reviewing policies intended to improve Nigeria’s attractiveness to local and foreign investors by reducing distortions that discourage business expansion.

He further explained that the administration was modernising the Value Added Tax framework to improve clarity around exemptions and expand input VAT credits for businesses, a move expected to reduce operational costs and moderate inflationary pressure within supply chains.

Oyedele also emphasised the importance of technology in transforming tax administration, noting that authorities are prioritising automation, digital filing systems and data integration to improve compliance and transparency.

Despite ongoing reforms, the minister acknowledged that Nigeria still faces major challenges, including public distrust in the tax system, weak institutional capacity and difficulties associated with integrating the informal sector into the formal tax structure.

Also speaking at the conference, Vice President Kashim Shettima defended the Federal Government’s tax reform programme, describing it as a long-term strategy aimed at improving economic growth, encouraging enterprise and reducing poverty.

Represented by his economic adviser, Shettima said the administration was committed to building an economy that creates opportunities for Nigerians across different social and economic backgrounds.

The Vice President noted that public scepticism remains one of the biggest obstacles facing the reform process, stressing the need for stronger public engagement and awareness around the objectives of the policy changes.

Participants at the conference said Nigeria’s tax reform agenda represents one of the most significant attempts in decades to restructure the country’s fiscal system and reduce dependence on debt-driven economic management.