“The only difference between death and taxes is that death doesn’t get worse every time parliament meets.” Mark Twain
For decades, taxes in Nigeria have felt less like a civic duty and more like a punishment. Multiple levies, overlapping authorities, aggressive collections, and little visible public benefit have combined to turn taxation into a national grievance. So when the Federal Government announced sweeping tax reforms earlier this year, suspicion came naturally.
At the center of that reform conversation is Taiwo Oyedele, Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms a tax expert tasked with fixing what many consider one of Nigeria’s most broken systems.
Oyedele’s mission is ambitious: simplify Nigeria’s chaotic tax regime, expand the tax net without punishing the poor, and create a fairer system where economic growth is rewarded rather than strangled.
A System That Punishes the Honest
Nigeria has over 60 different taxes and levies, not counting informal and illegal collections by local authorities. Yet, out of an estimated 86 million economically active Nigerians, fewer than 10 million are in the formal tax net. For businesses, the situation is no better: more than a million companies are registered with the Corporate Affairs Commission, but barely 100,000 actively pay taxes.
The result is a deeply distorted economy one where honest taxpayers struggle to compete with evaders, while governments at all levels still complain of inadequate revenue.
According to Oyedele, this is not sustainable.
“We are rewarding bad behaviour,” he has said. “If you pay tax and your competitor doesn’t, you will eventually be forced out of business.”
Fewer Taxes, Wider Net
One of the committee’s most radical proposals is to collapse over 60 taxes into a single-digit number, harmonising collections across federal, state, and local governments. The goal is not to extract more money from the same people, but to bring more people into the system, while lowering the burden on those already paying.
Under the reform:
Low-income earners and small businesses are either exempt or pay less
Middle-income earners enjoy reduced rates and higher reliefs
High-income individuals pay more, but still at rates lower than many African peers
Oyedele notes that Nigeria’s proposed maximum personal income tax rate of 25% remains lower than Ghana (35%), Kenya (35%), and South Africa (45%).
The Bread Example: Why Prices Should Fall, Not Rise
One of the loudest fears surrounding the reforms is that prices will rise from January. Oyedele insists the opposite should happen—and uses bread to explain why.
Under the old tax law, bread was VAT-exempt. That sounded good on paper, but it came with a hidden cost.
Because bread was exempt:
Bakers did not charge VAT on bread sales
But they paid VAT on equipment, vehicles, phones, airtime, fuel, and delivery services
That VAT was not refundable
In practice, the baker absorbed all that VAT as part of production costs—then passed it on to consumers through higher prices.
Under the new reform, bread is no longer exempt. It is now zero-rated.
This distinction matters.
Zero-rated means:
VAT applies at 0% on bread sales
All VAT incurred during production is fully refundable
For bakers, production costs fall. For consumers, prices should either reduce or at least stop rising. The reform removes hidden taxes from essential goods rather than adding new ones.
Automation Over Harassment
Another cornerstone of the reform is moving away from physical, cash-based tax collection often enforced through intimidation and violence towards automation and data-driven compliance.
Instead of tax agents chasing drivers with sticks or removing number plates, government plans to rely on:
Bank transaction data
Payment card usage
Utility records
Automated invoicing systems
The aim is professionalism, not punishment. Small earners are not the target. Large, unexplained lifestyles are.
“If you say you earned ₦1 million in a year but spent ₦50 million, you should be able to explain how,” Oyedele argues.
Not About More Pain About Balance
Perhaps the most controversial aspect of the reform is perception. Many Nigerians believe the government is introducing new taxes to squeeze citizens already struggling with inflation and subsidy removal.
Oyedele disputes this narrative strongly.
According to him, the Tinubu administration has reversed, suspended, or repealed more taxes than any government in recent history, including excise duties on telecoms, cybersecurity levies, carbon taxes on vehicles, and single-use plastics.
What the reform seeks is balance:
Lower costs for businesses
Higher disposable income for workers
Broader participation in nation-building
A Difficult Conversation, But a Necessary One
Nigeria’s tax-to-GDP ratio remains below 10%, far from the global average. The committee believes it can reach 18% within a few years not by taxing the poor, but by fixing leaks, expanding the net, and restoring trust.
Whether Nigerians will embrace the reform remains to be seen. What is clear, however, is that Taiwo Oyedele’s work has forced the country into a long-overdue conversation: not just about taxes, but about fairness, productivity, and the kind of society Nigerians want to build.
Because while death may be inevitable, taxes done right don’t have to feel like a punishment.
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