The International Monetary Fund (IMF) has called on the Nigerian government to ramp up efforts to boost tax revenue and strengthen enforcement against tax evasion, highlighting the need for improved fiscal sustainability amid mounting economic pressures.
In its latest assessment of Nigeria’s economy, the IMF emphasized that the country's tax-to-GDP ratio remains among the lowest globally, posing a significant challenge to financing public services and infrastructure. The Fund urged Nigerian authorities to implement comprehensive reforms aimed at expanding the tax base, enhancing compliance, and modernizing tax administration systems.
“Strengthening domestic revenue mobilization is critical for Nigeria’s long-term economic resilience,” the IMF stated. “Addressing widespread tax evasion and enhancing transparency in the fiscal system will allow the government to invest more effectively in development priorities such as education, healthcare, and infrastructure.”
The IMF recommended policy measures including reducing tax exemptions, improving data-sharing between agencies, adopting digital tax solutions, and increasing audits of high-income earners and corporations. It also advocated for more public engagement to foster a culture of tax compliance and trust in government.
Nigeria’s Federal Inland Revenue Service (FIRS) has already embarked on several initiatives to broaden the tax net, including the use of technology and partnerships with financial institutions. However, the IMF noted that enforcement efforts must be scaled up to deter non-compliance and recover lost revenues.