Adedeji Assumes Office, Promises 18% Tax-to-GDP Ratio

Acting chairman of the Federal Inland Revenue Service, Mr. Zacch Adedeji has resumed office as head of the revenue agency with an audacious aspiration – to surpass Africa’s average tax-to-GDP ratio of 16.5 percent and achieve an impressive 18 percent within three years.

Nigeria currently has 10.86 percent tax-to-GDP, according to former chairman of the FIRS, Mohammad Nami. Nami’s administration raised the figure from six percent to 10.86 percent, a standard Adedeji said he will surpass. “By doing so, we aim to reduce our nation’s reliance on borrowing and ensure financial sustainability,” Adedeji said yesterday during a handover ceremony that marks the transfer of authority from his predecessor to him at the revenue house in Abuja.

Speaking at the handover ceremony, Mr Nami also disclosed that the service is on track to set yet another record in 2023 as it collected over N8.5 trillion (cash) from 1st January to 14th September and have assessed, reconciled and recovered over N4 trillion outstanding tax liabilities and sequestered funds from NNPCL on behalf of the federation.

Nami said the total sum of over N12 trillion is exclusive of amounts invested by our taxpayers under the road infrastructure tax credit scheme and tax implications of waivers by government from January, 2023 to date.

Nami said certainly, the projections by the current government of tax to GDP of 18 percent in another four years is not only realisable but can be surpassed.

On his part, Dr Adedeji promised to go after tax defaulters in his resolve to aggressively drive compliance. “For those who deviate from their tax obligations, rest assured, we will enforce our responsibilities judiciously,” he stated, adding that his administration will implement a robust enforcement model that effectively defers tax evaders while maintaining fairness and transparency in the processes of the service.

He committed to simplifying Nigeria’s tax system, making it accessible and comprehensible, with a focus on facilitating voluntary tax payments and fostering a sense of civic responsibility.

Dr Adedeji said quality data will be the cornerstone of the FIRS’ operations under his watch, enabling it to measure progress, make informed decisions, and maintain the highest standards of accountability. “We recognise that data-driven strategies are essential to our success.

“I pledge to maintain an open-door policy, actively engaging with stakeholders to collaboratively construct a tax administration that we can all take pride in. Together, we will build an institution that serves as a beacon of excellence,” he stated.

Meanwhile, the immediate past chairman of FIRS has advised his successor, Mr. Zacch Adedeji continued with the reforms and projects that were introduced during his four-year administration for high tax revenue generation and effective tax collection, even as he said some of the reforms could be changed.

“The reforms may require more changes to the administrative and operational structure of the Service. Therefore, I encourage the acting Executive Chairman to continue with these reforms and projects for the benefit of our dear country,” Mr Nami said on Monday at an event to mark a formal hand to the acting chairman of the service.

The FIRS under Nami had projected a total 2023 tax collection of a minimum of N15 trillion and a projected tax to GDP of nearly 14 per cent by December 2023.

Nami took time to highlight some of his achievements as chairman of the service. He said his administration embarked on broad reforms focusing on automation of tax administration processes and administrative and operational restructuring of the service.

“The service achieved this goal by using in-house capacities to develop and deploy the Taxpro MAX which had been in use since 2021. The Taxpro MAX is a landmark success considering that the legacy iTax system that was procured at huge costs did not operate beyond the pilot stage,” he stated.