By Nchetachi Chukwuajah
The Revenue Mobilisation, Allocation and Fiscal Commission (RMAFC) has stated that inflows into the Federation Account increased to N23.06 trillion in the first 10 months of 2025.
Chairman of RMAFC, Mohammed Shehu, disclosed this in Abuja on Monday, December 15, while delivering his keynote address at a two-day National Stakeholders’ Discourse on Enhancing Fiscal Efficiency and Revenue Growth under the Nigeria Tax Act, 2025.
Shehu attributed the increase to fiscal reforms and discipline, stronger audits, and improved coordination among revenue agencies.
He said: “The ten months accruals into the Federation Account in the period January to October, 2025 was N23,058,248,707,725.50.”
Shehu said the increase in inflows marked a steady improvement over previous years, with total gross accruals standing at N11.93 trillion in 2023 and N21.43 trillion in 2024.
He explained that the growth was driven by “fiscal reforms, tracking and coordination among revenue agencies, stronger audits, digital tracking, and fiscal reforms,” noting that the measures had expanded the revenue pool available for distribution to the federal, state, and local governments.
Shehu said the trend reflected progress towards a more resilient and sustainable public finance system with reduced dependence on oil earnings, adding that the fluctuations in crude prices had historically exposed the country to boom-and-bust revenue cycles that undermined fiscal stability and long-term planning.
He said, “The Nigerian economy has suffered from boom-bust cycles driven by volatile oil prices, creating unpredictable revenue streams that undermine long-term planning and fiscal stability.”
The RMAFC chairman said the Nigeria Tax Act, 2025, which will take effect on January 1, 2026, was designed to address these structural weaknesses by harmonising previously fragmented tax laws into a single statute.
He said the Act would eliminate duplication and obsolete provisions, reduce compliance burdens for taxpayers, and enhance the ease of doing business across the country.
“The Nigeria Tax Act, 2025, has not only harmonised the hitherto Nigeria’s fragmented tax laws into a single statute, but it has also reduced or eliminated duplication and obsolete provisions while enhancing ease of doing business,” Shehu stated.
He added that the reforms would create a more coherent and predictable fiscal environment while eliminating regional differences in tax administration.
Shehu further noted that the RMAFC would intensify monitoring of revenue collections and disbursements from the Federation Account through enhanced oversight, forensic audits, and stronger collaboration with subnational governments on non-oil revenue mobilisation.
Also speaking at the event, the Chairman of the Presidential Fiscal Policy and Tax Reforms Committee, Taiwo Oyedele, said the Nigeria Tax Act, 2025 aims to correct decades of structural weaknesses in the country’s tax system and promote fairness, efficiency, and economic growth.
Oyedele said Nigeria’s tax system had become overly complex and punitive, stressing that incremental fixes were no longer sufficient.
“These reforms should have been done 20 or 30 years ago. Things got so bad with our tax system that incremental fixing would no longer solve the problem. We needed a transformation,” he said.
He explained that the reforms repealed major existing tax laws and replaced them with new ones to stop what he described as “taxing poverty, capital, and investments” using outdated statutes inherited from the colonial era.
According to him, the core objectives of the reforms include fairness, harmonisation, ease of doing business, transparency in the use of tax revenues, and overall economic development.
Oyedele said the committee deliberately focused on efficiency rather than introducing new taxes, stressing that the proliferation of levies across tiers of government had created leakages, corruption, and heavy burdens on small businesses and vulnerable citizens.
He disclosed that under the new tax laws, low-income earners, including those on the national minimum wage, would be exempted from personal income tax from January 2026, while middle-income earners would see reductions in their PAYE obligations.
Oyedele added that the reforms also targeted lower living costs by zero-rating essential consumptions such as food, transport, health, education, and rent for value-added tax, explaining that businesses would be refunded VAT incurred in producing such goods to prevent hidden taxes being passed on to consumers.
