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NIGERIA
Nigeria is home to 190 million people and its economy is the biggest of the entire continent. Remarkably, almost ¾ of its population lives below the poverty line. This can be ascribed to many factors, of which one is the dramatically low tax collection. The ‘twin devils’ tax evasion and avoidance create a huge gap between potential revenue collection and actual collection The implementation of tax incentives in Nigeria is undermined by weak institutions, poor infrastructure, inadequate policy monitoring and evaluation as well as little to no transparency. This results in Nigeria missing out on billions in tax revenue from big multinationals every year. Additionally, the over-reliance on indirect taxes is a major structural issue of the tax system, which hinders the reduction of extreme inequalities.The FTM report for Nigeria can be found below:
FTM Report Nigeria 17-7
- 2018
- 2015
- 2016
Detail view
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PROGRESSIVE TAX SYSTEM
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Overall Progressivity
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Personal Income Tax
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Wealth Taxes
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Value Added Tax/Sales Tax
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Trade taxes
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Presumptive/Turnover Tax
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Corporate Income Tax
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SUFFICIENT REVENUES
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Tax Revenues
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Revenues from Extractive Industries
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Tax Payers
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EFFECTIVE TAX ADMINISTRATION
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Organization
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Administration
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Resources
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Oversight
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PRO-POOR PUBLIC SPENDING
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Agriculture
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Education
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Healthcare
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ACCOUNTABLE PUBLIC FINANCES
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Tax System Transparency
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Information Availability on Companies
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Audit
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Budget Documentation
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Citizens’ Engagement
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WELL GOVERNED TAX EXEMPTIONS
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Governance
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Transparency
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PROGRESSIVE TAX SYSTEM
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Overall Progressivity
-
Personal Income Tax
-
Wealth Taxes
-
Value Added Tax/Sales Tax
-
Trade taxes
-
Presumptive/Turnover Tax
-
Corporate Income Tax
-
-
SUFFICIENT REVENUES
-
Tax Revenues
-
Revenues from Extractive Industries
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Tax Payers
-
-
EFFECTIVE TAX ADMINISTRATION
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Organization
-
Administration
-
Resources
-
Oversight
-
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PRO-POOR PUBLIC SPENDING
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Agriculture
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Education
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Healthcare
-
-
ACCOUNTABLE PUBLIC FINANCES
-
Tax System Transparency
-
Information Availability on Companies
-
Audit
-
Budget Documentation
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Citizens’ Engagement
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WELL GOVERNED TAX EXEMPTIONS
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Governance
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Transparency
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PROGRESSIVE TAX SYSTEM6
The Nigerian tax system is quite progressive due to tax brackets. However, these brackets could be even higher, and the wealth taxes that the government said it would impose should be implemented.
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Overall Progressivity10
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Personal Income Tax6
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Wealth Taxes2
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Value Added Tax/Sales Tax5
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Trade taxes5
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Presumptive/Turnover Tax8
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Corporate Income Tax7
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SUFFICIENT REVENUES7
The tax-to-GDP ratio is amongst the lowest of the continent, but the tax base has increased over the years. The government has been able to collect a fair amount of revenues due to Nigerian oil.
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Tax Revenues3
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Revenues from Extractive Industries6
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Tax Payers10
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EFFECTIVE TAX ADMINISTRATION6
Cost of collection is rather high – five times the capital expenditure for health or education in 2018. This indicates inefficiency. The possibility to file taxes online is there, which has been a great step forward in tax collection since 2012.
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Organization5
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Administration8
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Resources5
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Oversight6
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PRO-POOR PUBLIC SPENDING2
Expenditure on health, education and agriculture do not meet international standards. Expenditure on other areas such as presidency and military do enjoy royal allocations.
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Agriculture6
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Education0
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Healthcare0
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ACCOUNTABLE PUBLIC FINANCES5
Revenue generated statistics are available on the websites of the national tax body. Yet, not all budget documents are not publicly available or published in a timely manner, which raises integrity concerns. Procedures and eligibility for tax incentives and exemptions are contained in various tax laws, but their implementations are shrouded in secrecy.
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Tax System Transparency3
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Information Availability on Companies2
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Audit4
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Budget Documentation6
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Citizens’ Engagement9
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WELL GOVERNED TAX EXEMPTIONS2
Procedures and eligibility for tax incentives and exemptions are contained in various tax laws, but their implementations are shrouded in secrecy. Additionally, corruption remains a major problem.
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Governance2
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Transparency1
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