Nigeria’s tax reforms incomplete without corporate tax cuts — Oyedele

Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, Taiwo Oyedele, has stated Nigeria’s tax reforms remain incomplete without cutting corporate tax rates and addressing regulatory overreach. He made this known in a lecture titled ‘Designing Tomorrow: Policy Blueprint and Lessons for the Future’, shared on X to mark his 50th birthday.

Oyedele’s remarks come ten days after President Bola Tinubu signed four key tax-related laws: the Nigeria Tax Law, Nigeria Tax Administration Law, Nigeria Revenue Service (Establishment) Law, and the Joint Revenue Board (Establishment) Law. Despite these milestones, Oyedele stressed that more critical adjustments are needed to attract investments and stimulate business expansion.

He warned that maintaining high taxes in a high-inflation environment effectively taxes capital, not profit. He called for reforms that would reduce tariffs on raw materials and intermediate products, which he noted are currently twice the sub-Saharan African average, and urged the government to embrace digitalisation while limiting regulatory interference.

Oyedele also advocated for measures to stabilise the naira, such as allowing tax payments exclusively in the local currency and reducing discretionary forex demands. He noted that despite having a similar trade balance to South Africa and Kenya over the past decade, the naira has depreciated six times more than their currencies.

The economist argued that sound reforms could have positioned Nigeria as a $1 trillion economy with lower poverty, a stronger middle class, and better purchasing power. He cautioned policymakers against crowd-pleasing strategies, saying “after the applause, the pain will remain,” and urged a focus on areas the private sector cannot handle.

Beyond revenue generation, Oyedele said tax reform can address national challenges like corruption and inefficiency. He proposed an intelligent tax system supported by laws on beneficial ownership, unexplained wealth orders, effective asset declaration, and transparent procurement processes.

He highlighted key provisions in the reform agenda, including full income tax exemptions for over one-third of workers, higher thresholds for small businesses, reduced costs for essential goods, and tax incentives for digital and remote work sectors. Other measures include boosting exports and eliminating double taxation on international operations.

Additional reforms include a tax ombudsman, faster refunds, lower withholding tax rates, and simplified compliance processes. Oyedele said these changes would make evasion more costly, improve accountability, and offer fairer revenue treatment for sub-national governments.