{"id":5810,"date":"2026-05-17T22:24:23","date_gmt":"2026-05-17T22:24:23","guid":{"rendered":"https:\/\/stakebridgeirpr.com\/media\/?p=5810"},"modified":"2026-05-17T22:24:23","modified_gmt":"2026-05-17T22:24:23","slug":"shettima-says-tax-reforms-reduced-nigerias-debt-burden-fiscal-pressure","status":"publish","type":"post","link":"https:\/\/stakebridgeirpr.com\/media\/shettima-says-tax-reforms-reduced-nigerias-debt-burden-fiscal-pressure\/","title":{"rendered":"Shettima Says Tax Reforms Reduced Nigeria\u2019s Debt Burden, Fiscal Pressure"},"content":{"rendered":"

By Olumide Johnson<\/strong><\/p>\n

 <\/p>\n

Vice President Kashim Shettima recently said that Nigeria\u2019s debt service-to-revenue ratio declined from 120 percent in December 2022 to 68 percent in 2025 following ongoing tax reforms introduced under President Bola Ahmed Tinubu\u2019s administration. Represented by Special Adviser to the President on Economic Affairs, Dr. Tope Fasua, Shettima spoke at the 2026 Tax Conference organised by the Chartered Institute of Taxation of Nigeria (CITN) in Abuja.<\/p>\n

The conference, themed \u2018Tax Reforms and Global Relevance: Positioning Nigeria\u2019s Tax System for a Sustainable Future,\u2019 also featured Minister of Finance and Coordinating Minister of the Economy, Mr. Taiwo Oyedele, and President and Chairman of Council of CITN, Mr. Innocent Ohagwa.<\/p>\n

Shettima said that the reforms, which took effect from January 1, 2026, represented Nigeria\u2019s first major tax overhaul in more than 35 years and were aimed at strengthening fiscal sustainability, improving revenue mobilisation and supporting the administration\u2019s ambition of building a $1 trillion economy by 2030.<\/p>\n

He stated that \u201cthe only antidote\u201d to Nigeria\u2019s high debt service burden was stronger government revenue driven by \u201cwell-thought-through and properly-established fiscal laws.\u201d Shettima added that reforms would help Nigeria shift \u201cfrom a nation that borrows to survive to one that invests to thrive.\u201d<\/p>\n

Oyedele said that the reforms were not designed to increase taxation, but to build \u201ca stronger fiscal foundation for long-term national development,\u201d while addressing structural weaknesses such as fragmented administration, multiple taxation, weak compliance and unstable revenues. Ohagwa described taxation as central to Nigeria\u2019s transition away from oil dependence and urged professionals to support implementation through transparency and compliance.<\/p>\n

DECISION HIGHLIGHT<\/strong><\/p>\n

Nigeria is repositioning tax reform as a fiscal stabilisation and economic competitiveness strategy aimed at reducing debt vulnerability, widening the tax base and supporting long-term economic restructuring.<\/p>\n

DECISION MEMO <\/strong><\/p>\n

The administration\u2019s tax reform narrative increasingly reflects a strategic shift from short-term revenue collection towards broader fiscal restructuring and institutional modernisation.<\/p>\n

Shettima\u2019s disclosure that the debt service-to-revenue ratio declined from 120 percent to 68 percent is economically significant because it addresses one of the central vulnerabilities confronting Nigeria\u2019s public finance system, the extent to which government revenues had become consumed by debt obligations. The reduction suggests some improvement in fiscal breathing space, although the ratio remains elevated by international standards.<\/p>\n

The reforms also reveal a wider attempt to rebuild state credibility around taxation. Oyedele\u2019s emphasis on fairness, clarity and reduced compliance burden suggests the administration recognises that weak trust in the tax system has historically undermined compliance and revenue expansion.<\/p>\n

The government\u2019s effort to exempt low-income earners and small businesses from taxation further reflects an attempt to politically reposition fiscal reforms as growth-supportive rather than extraction-driven. Shettima\u2019s repeated defence of the reforms against criticism indicates awareness that public resistance remains a major implementation risk.<\/p>\n

At the institutional level, the reforms represent one of the most ambitious attempts in decades to harmonise Nigeria\u2019s fragmented tax architecture. Multiple taxation, overlapping enforcement and weak coordination across government tiers have long increased business costs and discouraged formalisation.<\/p>\n

However, the administration\u2019s emphasis on competitiveness also highlights a deeper concern. Nigeria\u2019s fiscal system is increasingly being evaluated not only on revenue generation, but on its ability to attract investment, support productivity and compete within a global economy shaped by mobile capital and integrated supply chains.<\/p>\n

The role assigned to the Nigeria Revenue Service (NRS), state tax authorities, Joint Revenue Board and Tax Ombuds structure additionally signals an expanding governance framework around compliance enforcement and fiscal coordination.<\/p>\n

Yet implementation remains the defining challenge. While the reforms seek to modernise fiscal administration, success depends on whether government can reduce discretionary enforcement, sustain institutional coordination and convince taxpayers that higher compliance will translate into improved public services and economic stability.<\/p>\n

Overall, the reforms reflect an effort to transform taxation from a narrow revenue tool into a central instrument of macroeconomic management and national competitiveness.<\/p>\n

DATA BOX<\/strong><\/p>\n