Imagine a global economic race, where countries are high-speed race cars, each vying for growth, investment, and prosperity. Now, picture Nigeria as a 1950s jalopy, sputtering along while others speed ahead in sleek, modern machines. While other nations have streamlined their tax policies and economic frameworks to enhance productivity, Nigeria remains weighed down by archaic regulations, excessive taxation, and policies that stifle growth – Taiwo Oyedele, Chairman of the Presidential Fiscal Policy and Tax Reforms Committee
Taxation is easier to acknowledge than to define. In principle, it is the mechanism through which governments generate revenue to provide public services and infrastructure. However, in reality, taxation in many economies determines the extent to which businesses can thrive, investments can flourish, and citizens can attain economic stability.
Globally, tax policies are designed to drive development. Countries with progressive tax frameworks ensure that businesses operate in an environment that fosters growth. The United States, for example, reduced its corporate tax rate from 35% to 21% in 2017 to attract investment. Across Africa, nations like Rwanda have simplified their tax systems, improving compliance and economic participation.
Nigeria, however, has continued to operate an outdated and counterproductive tax system that hinders business growth, discourages investments, and inadvertently fuels informal economic activities. According to PwC, Nigeria has one of the highest numbers of taxes and levies globally, with over 60 different taxes imposed across federal, state, and local government levels. Despite this, tax revenue as a percentage of GDP remains abysmally low—at approximately 6.3% in 2023, far below the African average of 16% and the OECD average of 34%. This suggests that Nigeria’s tax burden is not just high but also inefficiently administered, leading to poor compliance and widespread evasion.
The Agusto & Co Economic Roundtable: A Platform for Insight
The 2025 Agusto & Co Economic Roundtable, held in honor of the late founder Mr. Olabode Agusto, convened industry leaders, policymakers, and economic experts to discuss critical issues shaping Nigeria’s economic landscape. As a reputable financial and credit rating institution, Agusto & Co. has established itself as a trusted source of independent economic analysis. Its Economic Roundtable serves as a critical platform for fostering informed dialogue on Nigeria’s fiscal policies, investment climate, and economic sustainability.
At this year’s forum, one of the most pressing discussions centered around Nigeria’s tax system and its role in either propelling or stalling economic growth. The keynote speaker, Taiwo Oyedele, Chairman of the Presidential Fiscal Policy and Tax Reforms Committee, provided a candid assessment of the country’s tax framework, highlighting its inefficiencies and structural weaknesses.
During the roundtable, the Chairman of the Presidential Fiscal Policy and Tax Reforms Committee highlighted the effects of Nigeria’s current tax system. He emphasized that the multiplicity of taxes and taxing agencies, along with a high corporate tax burden, creates an environment unconducive to growth.
Oyedele said, “We found that Nigeria’s tax system is unconducive for growth. We are trying to grow, but we’re struggling, and the tax system is holding us down. It has plenty of taxes and taxing agencies everywhere you turn. It doesn’t matter whether you’re small or big, whether you are formal or informal; we tax anything and everything that moves. If it keeps moving, we tax it even again. We tax it even more. We’re speaking to small business owners, and one woman said something to me that I will not forget. She said that it feels like the Nigerian system and the government are feasting on businesses”
He further noted that the system disproportionately taxes low-income earners and capital investments, rather than focusing on profits. This approach not only stifles economic growth but also deepens poverty levels across the nation.
Also speaking at the event, Yinka Adelekan, Managing Director, Agusto & Co., emphasized the importance of fostering a deeper understanding of Nigeria’s economic realities and leveraging credible insights to drive sustainable growth.
“As Nigeria navigates an evolving economic climate, it is crucial for businesses and policymakers to engage in meaningful dialogue,” Adelekan said. “This economic roundtable provides an essential platform to navigate the challenges and opportunities ahead, shaping our collective economic future.”
The Path Forward: Why Reform Matters
Platforms such as The Agusto & Co. Economic Roundtable underscored the urgent need for tax reform to stimulate investment, create jobs, and enhance Nigeria’s competitiveness in the global market. According to Oyedele, a restructured tax system should focus on broadening the tax base rather than overburdening compliant businesses and individuals. This entails simplifying tax laws, eliminating redundant levies, and ensuring that taxation is fair and progressive.
Additionally, he highlighted that effective tax reforms could drive economic growth, competitiveness, and shared prosperity. By shifting the focus from excessive taxation of businesses to policies that support enterprise development, Nigeria can create a more attractive investment climate and accelerate its economic transformation.
Conclusion
Abraham Lincoln once said, “The best way to predict the future is to create it.” Nigeria stands at a crossroads: continue a path of outdated, counterproductive taxation policies or embrace reforms that align with modern economic realities. The insights from the Agusto & Co. Economic Roundtable provide a compelling case for change. A well-structured tax system is not just about government revenue; it is a critical tool for fostering innovation, attracting investment, and improving the standard of living for millions of Nigerians. The time for reform is now—and the decisions made today will shape Nigeria’s economic future for generations to come.
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