While the expansion of Nigeria’s taxpayer base from 10 million to 100 million represents a significant shift in the nation’s fiscal architecture, the true measure of this milestone remains unproven. The central tension lies in whether this tenfold increase reflects a genuine widening of the revenue net or merely a symbolic bloating of administrative registers.
Experts across the financial sector argue that the sheer volume of names on a database offers little utility if the state lacks the mechanism to convert these entries into consistent and actual tax remittances.
“The number of individuals registered for tax purposes has increased from about 10 million to over 100 million,” said Taiwo Oyedele, noting that thousands of informal businesses are now seeking registration daily as reforms drive increased formalisation across the economy.
“An increase in registered taxpayers does not necessarily translate to a proportional rise in income tax revenue,” Ajibola Sogunro, tax partner at Forvis Mazars, said.
The sharp increase follows the rollout of the Nigeria Tax Act (NTA) 2025 and related reforms, which took effect from January 2026, introducing a data-driven tax system designed to widen the net while shielding low-income earners.
Under the new framework, all individuals and businesses are expected to be captured within a unified taxpayer database linked to National Identity Numbers (NIN) and corporate registrations, while compliance is enforced through mandatory e-invoicing and real-time transaction validation.
The reforms also extend tax visibility to previously under-taxed segments, including freelancers, digital content creators, and Nigerians earning income from foreign platforms.
But Sogunro cautioned that the headline figure raises questions about how the expansion was measured and what it truly represents.
“The 100 million figure raises questions around measurement. It is not entirely clear what metrics were used or how this number was derived, and that distinction is important when assessing its real impact,” he said.
Even beyond those concerns, he noted that the link between a larger taxpayer register and higher revenue is often overstated, particularly for direct income tax collections.
“As more people participate in economic activities, buying and selling goods and services, the government can capture value through taxable supplies. That is where the real revenue expansion will come from,” he added.
That distinction is critical in assessing the reform’s fiscal implications. Nigeria generated N28.3 trillion in tax revenue in 2025, exceeding its target of N25.2 trillion, with non-oil taxes contributing N21.5 trillion.
Company income tax accounted for N7.72 trillion in the first nine months of the year, while VAT collections reached N6.4 trillion over the same period, underscoring the growing importance of consumption taxes.
Despite this improvement, Nigeria’s tax-to-GDP ratio stands at about 13.5 percent, still below the African average of 16.1 percent and significantly behind peers such as Kenya at 15 percent and South Africa at 23 percent. The government is targeting an 18 percent ratio by 2027.
