The federal government and the Nigeria Revenue Service (NRS) have intensified calls for stronger collaboration among federal, state and local government institutions to improve tax compliance and strengthen revenue generation under Nigeria’s new tax regime.
Top government officials made the call on Tuesday at a national workshop on strengthening tax compliance under the new tax regime, held at the Transcorp Hilton Hotel in Abuja.
The workshop, organised by the Government Business Group of the Government and Large Taxpayers’ Directorate of the NRS, brought together officials from ministries, departments and agencies (MDAs), government-owned enterprises (GOEs), and representatives of sub-national governments.
The engagement comes amid the Federal Government’s broader economic reform programme aimed at repositioning public finance, expanding the tax base and reducing dependence on oil revenues.
Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, described the new tax regime as a central pillar of the administration’s structural reform agenda.
Represented by his Chief of Staff, Mr. Tolu Adegbie, the minister said the ongoing reforms were designed to move Nigeria away from unstable and volatile revenue sources toward a sustainable tax-driven economy capable of funding critical national development priorities.
“We are not here to just talk about administrative rules and regulatory guidelines; we are here as state actors to actively think through implementation of the new tax reforms and shape our fiscal architecture to provide sustainable funds required to address our pressing socio-economic challenges,” he said.
Oyedele linked the reforms to wider economic policy adjustments already being implemented by the Federal Government, including the floating of the naira, removal of fuel subsidies and measures aimed at tackling inflationary pressures.
According to him, the objective is to establish a stable and predictable fiscal environment that can sustainably support investments in infrastructure, healthcare, education and security.
“The new tax regime is a key part of our wider structural reform agenda, designed purposefully to move our economy away from reliance on volatile revenue sources towards a stable, predictable and equitable tax-based platform,” he added.
The minister described taxation as “the social contract in action,” stressing that efficient tax administration could only succeed where transparency, accountability and institutional cooperation exist across all tiers of government.
He noted that the NRS had been empowered to oversee federation tax administration, including taxes arising from transactions executed by federal, state and local government institutions.
“For sustainable success there must be alignment of policies between the Federal Government, sub-national administrations and our public enterprises,” Oyedele said.
He further called for deeper institutional cooperation through harmonised operational processes, information sharing and mutual accountability mechanisms.
According to him, genuine fiscal federalism can only thrive when all stakeholders contribute fairly to the national revenue pool.
“We have to be honest about the structural imbalances affecting voluntary tax compliance within our system. Going forward, we must create an environment where every taxpayer contributes fairly to the seed, and everyone can expect to share in the harvest,” he stated.
Executive Chairman of the Nigeria Revenue Service, Zacch Adedeji, said the agency faced enormous pressure to generate about ₦40 trillion in tax revenue this year to support allocations to the three tiers of government.
Adedeji described the target as a “Herculean task,” noting that it would require stronger cooperation among government institutions and improved compliance by public sector entities.
Represented by the Executive Director, Finance and Corporate Services Directorate, Mr. Muhammad Abubakar, the NRS chairman said revenue mobilisation remained critical to sustaining government developmental programmes nationwide.
“Our major role at the Nigeria Revenue Service is to sustainably finance the Federation Account Allocation Committee. This fund is the financial lifeblood of the three tiers of government and is used to finance the critical developmental projects that our citizens depend on,” he said.
According to him, the workshop was conceived as a strategic intervention to address longstanding bottlenecks in tax administration and deepen awareness among MDAs and GOEs regarding their statutory responsibilities as tax deduction and remittance agents.
Adedeji said the new tax regime was designed to reduce excessive dependence on enforcement measures and instead encourage voluntary compliance through institutional collaboration. “Our goal is to move away from an enforcement-dependent approach and move to a collaborative, voluntary compliance framework where every institutional stakeholder contributes its fair share to our collective national prosperity,” he stated.
The NRS chairman disclosed that monitoring and audit activities conducted by the agency had uncovered significant disparities in tax compliance among some states and government-owned enterprises.
According to him, the uneven compliance culture was undermining institutional fairness and placing undue pressure on states and organisations that consistently fulfilled their tax obligations.
“We have reports about the imbalance in compliance existing among states and GOEs which does great damage to institutional fairness, undermines the broader compliance culture and unfairly burdens compliant states,” he said.
He warned that such gaps posed a risk to the country’s fiscal stability and called on all tiers of government to demonstrate greater responsibility in revenue remittance obligations.
As part of measures aimed at promoting healthy competition and encouraging improved compliance, Adedeji announced that the NRS would commence recognition of the country’s most tax-compliant states from 2026. “Starting this year, 2026, the Service will launch an initiative to identify the most tax-compliant states across multiple dimensions. Excellence deserves recognition, and we look forward to honouring our top performers at the end of the year,” he said.
Also speaking, the Executive Director of the Government and Large Taxpayer Directorate at the NRS, Mrs. Amina Ado, said the workshop was strategically organised to engage key stakeholders responsible for driving Nigeria’s fiscal sustainability.
She said the country had reached a stage where all institutions whose operations impact public finance must align with national tax objectives.
Ado revealed that field monitoring and audit exercises by the NRS had exposed major leakages, particularly in the deduction and remittance of Value Added Tax (VAT) and Withholding Tax (WHT).
“While many sub-national entities are exemplary in their civic duties, there are still some significant structural leakages, especially in the prompt deduction and delay in remittance of Value Added Tax and Withholding Tax,” she said.
According to her, while some jurisdictions were making significant contributions to the national revenue pool, others continued to benefit from revenue allocations without fully meeting their tax obligations.
“This compliance gap distorts and creates an imbalance in our fiscal federalism,” she added.
Ado said the NRS was committed to building a more collaborative relationship with MDAs, GOEs and sub-national governments by reducing what she described as “enforcement-heavy friction” in tax administration.
She explained that the new tax reforms empowered the agency not only to enforce compliance but also to protect the rights of MDAs and GOEs operating as statutory tax agents.
“At NRS, our mission is to make the new tax laws easier to understand, reduce transition bottlenecks and build technologically driven and transparent remittance platforms that embed compliance into daily operations,” she said.
Participants at the workshop stressed the need for stronger institutional partnerships, improved transparency in tax administration and sustained policy coordination among all tiers of government.
