‘NRS Poised To Exceed N40. 7trn Target’

Nigeria’s fiscal trajectory is increasingly being defined by a new confidence in domestic revenue mobilisation, and at the centre of this shift stands the Nigeria Revenue Service (NRS), projecting an ambitious N40.711 trillion revenue target for 2026.

The figure represents a 44 per cent increase over the N28.289 trillion generated in 2025, a performance year in which the Service exceeded its target by achieving 112 per cent.

While the headline number is bold, the foundations beneath it appear solid. The NRS is not relying on speculative optimism; rather, it is building on a sustained growth pattern that has seen collections expand more than 4.4 times between 2021 and 2025. Year-on-year revenue growth has remained consistently positive, with particularly strong accelerations recorded during the 2021–2022 and 2023–2024 periods.

That upward trajectory has reshaped perceptions of what is achievable within Nigeria’s tax system.

At the core of the 2026 projection lies a strategic pivot toward non-oil revenue, which is expected to rise by 37.9 per cent to N24.836 trillion.

This signals a structural shift away from dependence on oil receipts toward diversified and more predictable revenue streams. Company Income Tax (CIT), Value Added Tax (VAT), and the Development Levy are projected to account for the bulk of this expansion, reflecting both improved compliance and deeper economic formalisation.

The emphasis on non-oil revenue is not merely technical; it reflects a broader economic necessity. Global fiscal conditions have tightened considerably, with multilateral financing shrinking and borrowing costs rising.

The Minister of Finance and Coordinating Minister of the Economy, Mr Wale Edun, has repeatedly stressed that developing nations now face higher debt servicing burdens and diminished external support.

In 2024 alone, developing countries collectively paid about $163 billion in debt service, significantly exceeding inflows from aid and foreign investment. Against this backdrop, Nigeria’s capacity to fund infrastructure, healthcare, education, and social protection depends increasingly on domestic revenue strength.

Edun has described sustainable revenue generation as no longer optional but essential, emphasising that fiscal reform must deliver measurable outcomes that support growth and stability. In this national reform matrix, the NRS occupies a central position.

The Service is expected not only to collect taxes but to anchor confidence in Nigeria’s fiscal architecture.

What distinguishes the 2026 outlook is the combination of structural reform and institutional transformation currently underway within the Service. The integration of royalty revenue into the NRS framework has created a significant additional revenue stream. Automation of petroleum profit tax, hydrocarbon tax, and royalty assessments is expected to reduce leakages while enhancing transparency and efficiency.

Digitisation sits at the heart of this transformation. The NRS plans to deploy advanced data analytics, e-invoicing platforms, and integrated government contract databases to improve audit quality and compliance monitoring.

Collaboration with subnational governments and federal ministries, departments, and agencies is also being strengthened to ensure more effective VAT and withholding tax remittances. By tightening inter-agency coordination and leveraging technology, the Service is building a more comprehensive revenue intelligence system.

These reforms are already yielding dividends. The strong growth recorded over the past several years suggests that improvements in compliance are not episodic but systemic.

Executive Director in charge of Government and Target Taxpayers, Amina Ado, has attributed recent successes to enhanced enforcement, expanded compliance efforts, and operational excellence across the institution. According to her, the 2026 target is achievable through sustained discipline and institutional cohesion.

Beyond operational reform, however, the NRS is also undergoing a cultural reset. At the 2026 Management Retreat themed “Designed to Adapt, Built to Deliver,” Executive Chairman Dr Zacch Adedeji called for deep leadership introspection as the Service enters what he described as a new institutional era.

He urged leaders to move beyond legacy structures and familiar habits, arguing that the demands of this moment require adaptive leadership.

Drawing insights from contemporary leadership scholarship, Adedeji observed that institutions often struggle not because of weak strategies, but because of unexamined beliefs about control, authority, and accountability.

He also cautioned against rigid oversight systems that inadvertently create bottlenecks and stifle innovation. Instead, he advocated empowerment, trust, and outcome-driven leadership.

His reflections underscored a critical truth: institutional culture shapes performance, and performance shapes revenue outcomes. By encouraging humility, openness, and shared responsibility, the NRS leadership is attempting to build a culture capable of sustaining large-scale reform.

This internal recalibration may prove as consequential as any technical reform. Revenue agencies operate at the intersection of law, economics, and public trust. When taxpayers perceive fairness, clarity, and professionalism, voluntary compliance increases. In turn, enforcement becomes more efficient and less adversarial.

The service’s confidence is further bolstered by macroeconomic stabilisation efforts underway in the broader economy. As economic reforms deepen and sectors become more formalised, taxable activity expands.

If corporate profitability strengthens and consumption stabilises, CIT and VAT collections could outperform projections.

The addition of royalty revenue also introduces upside potential that may push collections beyond conservative estimates.

Importantly, the NRS is not approaching 2026 as a routine fiscal year.

The NRS recognises that credibility in revenue mobilisation influences investor confidence and sovereign financial stability. A reliable domestic revenue base reduces dependence on debt, lowers fiscal vulnerability, and strengthens Nigeria’s negotiating position in global financial markets.

Observers note that few institutions have demonstrated the scale of sustained growth recorded by the NRS over the past four years. Achieving 112 per cent of target in 2025 reinforces the perception that the Service has entered a new performance phase. If non-oil revenues expand as projected—and compliance gains continue to compound—the N40.711 trillion target may represent a floor rather than a ceiling.

The broader policy environment also supports the outlook. Fiscal reforms under the current administration are designed to promote fairness, efficiency, and transparency. The alignment between political commitment and institutional capacity strengthens the probability of success.

Ultimately, the case for meeting—and potentially surpassing—the 2026 revenue target rests on three pillars: structural reform, operational efficiency, and leadership transformation. The Service has broadened its revenue base, modernised its enforcement architecture, and recalibrated its internal culture. Each of these elements reinforces the others.

Nigeria’s fiscal resilience in the coming years will depend heavily on the strength of its revenue institutions.

In an era marked by global uncertainty, rising borrowing costs, and fiscal shocks, domestic revenue capacity defines economic sovereignty.

With continuous growth behind it, digitisation accelerating compliance, new royalty streams integrated, and leadership focused on adaptive excellence, the Nigeria Revenue Service appears positioned not merely to pursue its N40.711 trillion target—but to redefine the upper limits of what Nigeria’s revenue system can achieve.

If recent performance trends are sustained, 2026 could mark another milestone in the country’s march toward sustainable, self-reliant public finance—and the NRS may once again set a new benchmark for delivery.