Federal Government Moves to Centralize Tax Collection for Improved Transparency and Revenue Efficiency
By Rita Uzuh | July 8, 2025
Abuja, Nigeria —
In a bold move to address inefficiencies, boost public trust, and increase internally generated revenue, the Federal Government of Nigeria has announced plans to implement a centralized tax collection system. The proposed model will unify tax collection efforts across all levels of government, enabling a more transparent, accountable, and technology-driven approach to revenue mobilization.
The decision, revealed by officials from the Federal Ministry of Finance during a recent economic reform forum in Abuja, is aimed at eliminating overlapping functions of multiple tax authorities, reducing leakages, and streamlining the process for individuals and corporate entities.
Currently, Nigeria operates a fragmented tax structure, where federal, state, and local governments maintain independent systems for collecting various taxes, including Value Added Tax (VAT), Personal Income Tax, and Company Income Tax. This system, experts argue, leads to confusion, double taxation, lack of accountability, and widespread tax evasion.
Under the proposed centralized framework, tax collection will be managed through a unified digital platform that integrates data from relevant agencies such as the Federal Inland Revenue Service (FIRS), State Internal Revenue Services (SIRS), and other revenue-generating bodies. The goal is to create a single, transparent interface where taxpayers can monitor obligations and make payments seamlessly.
Minister of Finance and Coordinating Minister of the Economy, Wale Edun, said the government is committed to modernizing the tax system as part of its broader fiscal reforms. He emphasized that a centralized model would not only promote fairness but also encourage voluntary compliance and broaden the tax base.
“We are focused on plugging leakages, improving collection efficiency, and ensuring that every naira collected is properly accounted for,” Edun stated. “A central tax platform will also help the government plan better by giving us real-time access to revenue data across the country.”
Stakeholders, including tax consultants, financial analysts, and business associations, have welcomed the move but stressed the importance of a smooth transition and widespread stakeholder engagement. Concerns have also been raised about ensuring equity in revenue sharing between the federal and sub-national governments under the new structure.
Economic analysts believe that centralizing tax collection could help Nigeria reduce its over-reliance on oil revenue by boosting non-oil income. It is also expected to align Nigeria’s tax administration with international best practices.
The Federal Government is expected to present a detailed policy framework to the National Assembly in the coming months, following consultations with state governments, the Joint Tax Board, and key industry players.
If successfully implemented, the centralized tax system could mark a turning point in Nigeria’s fiscal strategy, enhancing public confidence, improving transparency, and driving sustainable economic growth.
