In a candid conversation with Nigerian CEO Magazine, Zacch Adedeji, Executive Chairman of the Federal Inland Revenue Service (soon to be Nigeria Revenue Service), reflects on two years of fiscal transformation under President Bola Ahmed Tinubu’s administration. He describes the sweeping tax reforms as the most significant overhaul of Nigeria’s fiscal ecosystem since Independence in 1960.
A Record-Breaking Revenue Shift
Adedeji highlights that for the first time in Nigeria’s history, the three tiers of government shared a monthly allocation exceeding ₦2 trillion. Nearly 70% of this revenue came from taxes collected by FIRS, underscoring the impact of reforms that eliminated fuel subsidies and unified exchange rate windows.
“These reforms have strengthened the Federation Account,” Adedeji explains. “By removing bogus subsidy claims and streamlining revenue inflows, the government has empowered states and local councils to deliver more effectively to their citizens.”
Business-Friendly Tax Laws
One of the landmark achievements is the consolidation of Nigeria’s scattered tax legislations into a single streamlined framework. The new laws, effective January, reduce tax types to single digits and eliminate multiple taxation hurdles.
Key highlights include:
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VAT exemptions for food, education, shared transportation, and agriculture.
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Tax relief for small businesses with turnover below ₦50 million.
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Personal income adjustments for low-income earners.
“This is about compassion and practicality,” Adedeji notes. “We are removing burdens from businesses and citizens, creating an environment where prosperity can thrive.”
FIRS Transformation: From Enforcement to Service
Internally, the agency has shifted from a tax-type structure to a customer-centric model. Taxpayers are now categorized by turnover thresholds, with large taxpayers (₦5 billion and above) served through dedicated one-stop offices.
“We are no longer just enforcers,” Adedeji emphasizes. “We are service providers. Our role is to make compliance seamless and voluntary.”
Tangible National Gains
Adedeji rebuts claims that reforms have not benefited citizens, pointing to:
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Compressed Natural Gas (CNG) initiative reducing transport costs.
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Clearing of $7 billion foreign airline debt.
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Tax-to-GDP ratio growth from 10% to 13.5%, with a target of 18% by 2027.
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External reserves surge from $4 billion to $41 billion.
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Nigeria Education Loan Fund (NELFUND) disbursing ₦90 billion to over 450,000 students.
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Debt repayment of ₦1.85 trillion by 30 states in 18 months.
“These figures speak for themselves,” he asserts. “We are building fiscal stability and opening economic corridors across the country.”
The Petrol Tax Debate
Addressing concerns about a 5% petrol surcharge, Adedeji clarifies that while the provision exists under the FERMA Act, it requires a commencement order from the Finance Minister. “It is not automatic,” he stresses. “President Tinubu has already removed VAT on diesel. It is unlikely he would impose new burdens on petrol at this time.”
From FIRS to NRS: A Name That Reflects Reality
Explaining the agency’s rebranding, Adedeji says: “The word ‘Federal’ suggests we only collect for the federal government, which is misleading. For instance, 90% of VAT goes to states. The new name, Nigeria Revenue Service, better reflects our role as the sole tax authority for the federation.”
A Philosophy of Prosperity
Adedeji closes with President Tinubu’s guiding mantra: “We are not here to tax poverty; we are here to tax prosperity.”
“When companies thrive, Nigeria thrives,” he concludes. “Our mission is to remove hurdles, encourage growth, and ensure that the fruits of prosperity are shared fairly across the nation.”