The Federal Government has disclosed that it has collected over ₦600bn in Value Added Tax (VAT) from global digital service providers, including Facebook, Amazon, and Netflix.
Mr. Mathew Osanekwu, Special Adviser on Tax Policy to the Chairman of the Tax Reforms Committee, revealed this on Wednesday during a media workshop in Abuja.
He explained that amendments to the VAT Act empowered the Federal Inland Revenue Service (FIRS) to capture foreign companies rendering services in Nigeria.
“These are not Nigerian entities, but they are now paying VAT under Section 10 of the VAT Act. They are registered in Nigeria and are also appointed as agents of collection,” Osanekwu said.
Tinubu’s reforms not about adding new taxes
The Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, Prof. Taiwo Oyedele, used the event to clarify that President Bola Tinubu’s tax reforms were not about imposing fresh taxes.
He said the reforms were aimed at reducing the burden on low- and middle-income earners while ensuring fairness in the system.
“It’s not a new tax. Some said the tax is being proposed. The tax is not being proposed. Some believe this president has introduced tax after tax, and I challenge them to point to one newly introduced tax,” Oyedele stated.
Suspended taxes from Buhari’s last days
Oyedele reminded participants that Tinubu, within two months in office, had signed four executive orders suspending taxes introduced in the final days of the Buhari administration.
These included excise duties on plastics and imported vehicles.
“Many of us are not even aware because this president did not allow those taxes to take effect. They were suspended and eventually removed,” he added.
He also clarified that the controversial Cybersecurity Levy was not a Tinubu-era initiative but had been enacted years earlier.
Progressive reforms to strengthen weak tax system
The tax reforms, which take effect in January 2026, are designed to overhaul Nigeria’s weak tax structure, widen the revenue base, and improve compliance. Nigeria’s tax-to-GDP ratio stands at 10.8 per cent—well below Africa’s 16 per cent average and the global benchmark of 30 per cent.
Oyedele explained that the new framework seeks to consolidate multiple levies, cut duplication, and link tax revenues to visible projects. He stressed that the reforms protect vulnerable groups and fairly tax wealthier earners.
“This reform is the most progressive Nigeria has ever seen. It eliminates taxes on the poor, reduces the burden on the middle class, and targets higher-income earners fairly,” Oyedele said.
The committee chairman painted a grim picture of Nigeria’s economic state in May 2023, saying the country was “on the verge of collapse.”
He revealed that foreign reserves were weighed down by subsidy debts and forward contracts, leaving just about 200,000 barrels of free crude oil due to pre-sales.
According to him, Nigeria risked total fuel import paralysis had subsidies continued. “People may ask whether life is better now than it was two years ago. The right question is: would life have been better today if those reforms hadn’t happened?” Oyedele asked.
