₦airaland Forum

The International Monetary Fund has recommended introducing taxes on fuel products and telecommunications services in Nigeria as part of broader measures to increase government revenue and create fiscal space for development spending and social interventions.

The recommendation was contained in the IMF’s 2026 Article IV Consultation report on Nigeria, where the Fund argued that additional tax measures would be needed over the medium term despite the recent overhaul of the country’s tax system.

“Further tax policy changes will likely be needed—such as increasing the VAT rate, extending VAT to fuel products, rationalising tax expenditures in particular VAT exemptions on extractive industries and some customs duties, and introducing telecom excises—to complement administrative gains,” the IMF said.

The Washington-based institution, however, cautioned that the timing of any new taxes must take into account Nigeria’s rising poverty levels and worsening food insecurity.

“The timing of reforms must consider the poverty and food insecurity situation and ensure that the cash transfer system is in place and funded,” the Fund added.

The recommendation is likely to trigger fresh debate across the country, given the sensitivity surrounding fuel prices and telecommunications costs.

A previous attempt by the Federal Government to introduce a five per cent excise duty on telecom services faced widespread opposition from operators, subscribers and consumer advocacy groups before it was eventually suspended and later scrapped.

Telecommunications companies had argued that the sector was already burdened by multiple taxes, rising energy costs, foreign exchange pressures and infrastructure challenges, warning that any additional levy would ultimately be passed on to consumers through higher call and data charges.

Similarly, proposals linked to fuel taxation have generated opposition from labour unions and private sector groups amid concerns over rising living costs following the removal of petrol subsidies and increases in transport and food prices.

The IMF’s latest recommendation comes as it projects that Nigeria will need stronger revenue mobilisation efforts to sustain planned increases in public spending and support vulnerable households.

According to the report, revenue-enhancing tax policies could generate additional revenues equivalent to 3.9 per cent of Gross Domestic Product within three years of implementation. The Fund identified a two-percentage-point increase in the Value Added Tax rate as the single largest contributor, with an estimated revenue gain of 0.8 per cent of GDP.

It also projected that removing pioneer status incentives and revising free zone regulations would generate another 0.7 per cent of GDP, while reforms to capital gains taxation and adjustments to personal income tax bands, allowances and rates would each contribute 0.6 per cent of GDP.

The IMF further estimated that a top-up tax on multinationals and large firms could raise 0.5 per cent of GDP, while rationalising investment allowances would add another 0.4 per cent.

Notably, the category labelled “others”, which includes telecom excise duties and other measures such as a carbon tax on fuel, was projected to contribute an additional 0.4 per cent of GDP in revenue gains.

Beyond new tax measures, the Fund said Nigeria could generate even larger gains through stronger tax administration.

It projected that administrative reforms would yield an additional 3.1 per cent of GDP through improved compliance, enforcement and efforts to reduce informality in the economy.

According to the report, measures such as fiscalisation, electronic invoicing and cross-validation of tax deductions could generate 1.5 per cent of GDP, while expanded tax identification registration and consolidation of taxpayer databases could contribute another 1.6 per cent of GDP.

The IMF acknowledged that some of Nigeria’s recently enacted tax reforms would reduce government revenue in the short term because they were designed to support households and small businesses.

It estimated that revenue-reducing measures would lower revenues by 2.4 per cent of GDP, with expanded VAT input credits, additional zero-rated items and broader exemptions on basic consumption goods accounting for 1.7 percentage points.

Lower corporate income tax obligations for smaller firms would reduce revenues by 0.4 per cent of GDP, while lower personal income tax rates and expanded exemptions for low-income earners would account for another 0.3 percentage point reduction.

Overall, the IMF projected that the combined impact of revenue-enhancing measures, administrative reforms and revenue-reducing policies would result in a net increase in government revenue equivalent to 4.6 per cent of GDP over the medium term.

The Fund argued that stronger revenue mobilisation had become increasingly important because Nigeria’s fiscal position remained under pressure despite recent reforms.

Source: https://punchng.com/revenue-imf-asks-fg-to-impose-fuel-telecom-taxes

Be rest assured that Tinubu will comply. He practically lives for IMF validation and would do anything they say in exchange for a tap on the back.

Alright, shay him don create jobs first
In 2015,the APC promised us 3 million jobs per year, one naira equal to one dollar, fuel at 10 naira per liter.
2026 Apc how far??
The naira is been floated in the Atlantic ocean, fuel is costly because of the USA and Iran war, jobs are not available coz the majority of Nigerian youths are lazy.
Insecurity is a work of the opposition, mind you all those who are standing on this man's manhood is now using one leg to stand.
Even the owner of the manhood is tired.

It is better for government to go after personal income tax that remains almost a virgin territory. I doubt if the new sales taxes being proposed can add up to one billion dollars to the federal government revenue. Local governments too should go after the taxes allowed them by the constitution

AMINDA:
Be rest assured that Tinubu will comply. He practically lives for IMF validation and would do anything they say in exchange for a tap on the back.

Nigeria has a revenue problem. In fact, that is our biggest problem right now. We also have a citizenry that wants freebies. We want free or subsidized PMS, free education, free electricity, free healthcare services, beautiful bridges and roads that are not tolled etc. However, anytime the discussion shifts to how to raise the money to pay for all these freebies, the irresponsible opposition jumps out to put down the discussion. So, where do you think money for the freebies will come from? Heaven?

If we want development, we must be willing to pay for it. That is the only way we can develop. If we refuse to take the issues of revenue generation seriously, we wont make any meaningful progress as a country.

seunmsg:
Nigeria has a revenue problem. In fact, that is our biggest problem right now. We also have a citizenry that wants freebies. We want free or subsidized PMS, free education, free electricity, free healthcare services, beautiful bridges and roads that are not tolled etc. However, anytime the discussion shifts to how to raise the money to pay for all these freebies, the irresponsible opposition jumps out to put down the discussion. So, where do you think money for the freebies will come from? Heaven?

If we want development, we must be willing to pay for it. That is the only way we can develop. If we refuse to take the issues of revenue generation seriously, we wont make any meaningful progress as a country.

Despite all these, Tinubu and his immediate family moves in a 70-vehicle SUV convoy and he has the largest cabinet in the history of this country. All he knows is taxation, loans and revenue but impact is zero. You can only tax prosperity. Tinubu has impoverished Nigerians and yet he continues to squeeze.

lawani:
It is better for government to go after personal income tax that remains almost a virgin territory. I doubt if the new sales taxes being proposed can add up to one billion dollars to the federal government revenue. Local governments too should go after the taxes allowed them by the constitution

Persona Income Taxes in Nigeria goes to the state governments 100%. Federal Government does not get any kobo from personal income tax. Again, the PIT law was amended last year to reflect Nigeria's fiscal policy direction. Nigeria is moving away from direct taxes to indirect taxes. Personal Income Tax is a direct tax so we can't go back to pushing it up. Indirect taxes are way easier, more efficient and less controversial.

seunmsg:
Nigeria has a revenue problem. In fact, that is our biggest problem right now. We also have a citizenry that wants freebies. We want free or subsidized PMS, free education, free electricity, free healthcare services, beautiful bridges and roads that are not tolled etc. However, anytime the discussion shifts to how to raise the money to pay for all these freebies, the irresponsible opposition jumps out to put down the discussion. So, where do you think money for the freebies will come from? Heaven?

If we want development, we must be willing to pay for it. That is the only way we can develop. If we refuse to take the issues of revenue generation seriously, we wont make any meaningful progress as a country.

Not much revenue can be gotten from the telecoms and oil sectors by way of sales tax. I don't think their gross in total is up to 15 billion dollars and if there is a five percent tax on that, you only get 750 million dollars

seunmsg:
Persona Income Taxes in Nigeria goes to the state governments 100%. Federal Government does not get any kobo from personal income tax. Again, the PIT law was amended last year to reflect Nigeria's fiscal policy direction. Nigeria is moving away from direct taxes to indirect taxes. Personal Income Tax is a direct tax so we can't go back to pushing it up. Indirect taxes are way easier, more efficient and less controversial.

Yes it is states but any money that goes to any tier of government benefits the people. A Lagos taking 30 percent of it's GDP will be almost as liquid as the FG. It would be more liquid if not for the new revenue of VAT and CIT

AMINDA:
Despite all these, Tinubu and his immediate family moves in a 70-vehicle SUV convoy and he has the largest cabinet in the history of this country. All he knows is taxation, loans and revenue but impact is zero. You can only tax prosperity. Tinubu has impoverished Nigerians and yet he continues to squeeze.

The impact of the Tinubu administration is very visible. Only irresponsible people can deny the impact. We know the state of the economy when he took over and the situation today. In education, ASUU strike is a thing of the past. No one remembers it again. Folks who got admission in 2023 are now in final year preparing to graduate before the end of the year. Students from poor background no longer worry about how to get university education. One of them recently graduated as the best graduating student from LAUTECH. Of course, folks like you can't relate.

PMS queue is now long forgotten. It was an issue just two weeks to the 2023 election. Now, it seems no one remembers what the situation used to be. Again, we have about four massive international highways currently u der construction. These are projects that has the prospect of opening up so many economic opportunities for Nigerians. Some of these projects were conceived over 40 years ago with successive administration failing to get them started. One man has started everything in his first term.

The same IMF that told Tinubu to remove every subsidy that's helping majority of us Nigerians are telling him to remove another one. I hope Tinubu himself will use his initiative this time around.

AMINDA:
Despite all these, Tinubu and his immediate family moves in a 70-vehicle SUV convoy and he has the largest cabinet in the history of this country. All he knows is taxation, loans and revenue but impact is zero. You can only tax prosperity. Tinubu has impoverished Nigerians and yet he continues to squeeze.

On the management of the resources at his disposal, no serious person can say he is doing worse than any of his predecessors. Maybe he is not doing well enough is another question.

On revenue generation. Maybe we will have 70 billion dollars in revenue this year. Are you saying 25 billion dollars would have been better as it was before? Then who are the people being over taxed? Is it the civil servants or the people in the OPS with well paying jobs?
If the cost of living crisis in some cities were not there and the minimum wage is increased some and enforced on all employers then the nation will be on a very sound economic footing and the remaining challenges will be infrastructure and security

IMF

Just like foreign affairs minister Tuggar said you guys should be ashamed of yourselves.

You people don't want Nigeria to develop, you want Nigerians to suffer forever in poverty.

You feign ignorance of the highly corrupt habit and nature of our politicians yet you are asking and proposing more taxes as if the masses have the capacity to pay.

For how long would you do this, what do you stand to gain by ill advising our government ?
For how long would you continue to oppress , make children and women go through unimaginable pain and suffering ?

While your own women and children live in splendour, wealth and optimum luxury?

seunmsg:
The impact of the Tinubu administration is very visible. Only irresponsible people can deny the impact. We know the state of the economy when he took over and the situation today. In education, ASUU strike is a thing of the past. No one remembers it again. Folks who got admission in 2023 are now in final year preparing to graduate before the end of the year. Students from poor background no longer worry about how to get university education. One of them recently graduated as the best graduating student from LAUTECH. Of course, folks like you can't relate.

PMS queue is now long forgotten. It was an issue just two weeks to the 2023 election. Now, it seems no one remembers what the situation used to be. Again, we have about four massive international highways currently u der construction. These are projects that has the prospect of opening up so many economic opportunities for Nigerians. Some of these projects were conceived over 40 years ago with successive administration failing to get them started. One man has started everything in his first term.

Lol. ASUU strike, fuel queues? How can they be fuel queues when Dangote has excess refined fuel in his storage while Tinubu continues to import from Malta? That was Buhari, not Tinubu. He even tried to frustrate Dangote in the early days. Pound for pound, Buhari has more visible "completed" infrastructural projects on ground than Tinubu in his first tenure and he borrowed far less than Tinubu. He paid subsidy on both electricity and fuel and life was easier for the ordinary citizen than it is today. Should we talk about inflation rate? Continue to celebrate statistics and IMF validation but the lived realities of Nigerians says otherwise.

lawani:
Not much revenue can be gotten from the telecoms and oil sectors by way of sales tax. I don't think their gross in total is up to 15 billion dollars and if there is a five percent tax on that, you only get 750 million dollars

$750,000,000 will add a little about N1.1Trillion to the Federation account annually. Big addition to the monthly revenue of all the tiers of government without the usual noise that will follow any attempt to increase payroll tax.

AMINDA:
Lol. ASUU strike, fuel queues? How can they be fuel queues when Dangote has excess refined fuel in his storage while Tinubu continues to import from Malta? That was Buhari, not Tinubu. He even tried to frustrate Dangote in the early days. Pound for pound, Buhari has more visible "completed" infrastrural projects on ground than Tinubu in his first tenure and he borrowed far less than Tinubu. He paid subsidy on both electricity and fuel and life was easier for the ordinary citizen than it is today. Should we talk about inflation rate? Continue to celebrate statistics and IMF validation but the lived realities of Nigerians says otherwise.

Nigeria has a revenue problem and that has been established. You are an Atiku lackey on this forum and you've voiced your opposition to all the efforts of the current administration to increase the revenue base of the country. So, tell us in details how Atiku will solve the revenue problem so that the country can have enough money to transform from a third world country to a first world country with freebies for citizens under 3 years. I am waiting.

seunmsg:
$750,000,000 will add a little about N1.1Trillion to the Federation account annually. Big addition to the monthly revenue of all the tiers of government without the usual noise that will follow any attempt to increase payroll tax.

Oil is say 30 billion dollars per annum or less and it now represents 25 percent of federal revenue which means federal revenue is expected to be like 100 billion dollars this year unless published data is not accurate. What difference will 750 million dollars make?

If the government is transparent and accountable they won't been needing loans and raise taxes. Take wike, for example, he divided rivers state internally generated revenue into 2 equal halves and kept one for himself for 8 years. Local government t chairmen, state assembly members, judiciary, national Assembly members, civil servants, ministers and and board members.. Name them; they all do the same.
Our problem isn't lack or revenue but judicious use of it.
A country where a police commissioner, customs area commander, GOCs and the likes are richer than some local governments...no questions asked.
This guy called tinubu should impose any more taxes on us oooo. Make him check himself and his fellow looters first.

The advise is good but our implementation is the problem. They advised us in principle to increase taxes on goods used by almost all as a way to reach more citizens and then use the taxes for developmental services. The issue is what are we developing with it as a country. Duplication of not-so-urgent roads?
Flyovers? Idle airports? Religious subsidy? Looting?

This body is the problem with Nigeria and Africa.
They hardly speak against corrupt politicians and always quick to propose and support wicked policies

seunmsg:
$750,000,000 will add a little about N1.1Trillion to the Federation account annually. Big addition to the monthly revenue of all the tiers of government without the usual noise that will follow any attempt to increase payroll tax.

What do they do with the extra money. Who holds them to account. Nobody talks about transparency. What have they done with the ones they have received.

seunmsg:
Nigeria has a revenue problem and that has been established. You are an Atiku lackey on this forum and you've voiced your opposition to all the efforts of the current administration to increase the revenue base of the country. So, tell us in details how Atiku will solve the revenue problem so that the country can have enough money to transform from a third world country to a first world country with freebies for citizens under 3 years. I am waiting.

Nigeria's problem is more of a spending problem and a corruption problem. What has Tinubu done with monies saved from subsidy removal? More revenue that he claims to have channeled to the governors without accountability. Yet, he keeps throwing more at them and even sometimes using coercion and state of emergencies to get them to decamp to his party. Can you explain why Tinubu has over 40 ministers and why he, Remi, and Seyi move in 100-vehicle convoys? Why is austerity only for the struggling citizens and not for Tinubu and his family? The first step will be for Tinubu to show some empathy and stop with the display of opulence and megalomania.

Why doesn't the IMF makes suggestions like this to the US, UK, Germany, France and Canada? They recommend subsidies for these countries but keep advising African countries to impose the harshest of economic measures on her citizens.

lawani:
Oil is say 30 billion dollars per annum or less and it now represents 25 percent of federal revenue which means federal revenue is expected to be like 100 billion dollars this year unless published data is not accurate. What difference will 750 million dollars make?

Even with the Iran war, we can't get $30billion from oil sales. Maybe $20b. So, adding $750,000,000 won't be a bad idea. The payroll tax increase you are suggesting won't fly. The Political backlash will be much. Again, it is against our fiscal direction. Less direct taxes, explore more of indirect taxes.

Dogalmighty17:
Why doesn't the IMF makes suggestions like this to the US, UK, Germany, France and Canada? They recommend subsidies for these countries but keep advising African countries to impose the harshest of economic measures on her citizens.

Because those countries already have taxes on all these items including an average payroll tax of 40%.

Nawaoo for IMF
They re selfish, not after the suffering of masses
What IMF needs is constant repayment of debt owed to them by the FG
How the FG gets the money is none of their business

Shove your opinion. We can handle our affairs without seeking your validation

The yeye IMF that have been busy borrowing African leaders money without caring on how they spend it

I remember on this same forum when I said South Africa and Egypt are using old gory with their economy

Egypt case is still good as the money they borrowed is been used to develop a new city from scratch in a desert.

What can South Africa point out to to what they have done or achieved with the borrowed money?

Had they spent the money judiciously, we won't be hearing Goldberg noise from their citizens

Kenya also is in a big mess with a loan burden

seunmsg:
Nigeria has a revenue problem and that has been established. You are an Atiku lackey on this forum and you've voiced your opposition to all the efforts of the current administration to increase the revenue base of the country. So, tell us in details how Atiku will solve the revenue problem so that the country can have enough money to transform from a third world country to a first world country with freebies for citizens under 3 years. I am waiting.

I hope you’re getting paid for all these defense you put up for these politicians. I mean real good pay. Don’t do it for free.

Nigeria has no revenue problems, we have spending problems from our so called leaders.

You claim there’s revenue problems, yet politicians budget far more money to service their lifestyles than healthcare.

21bn naira was spent to renovate not build, renovate the VPs residence while a whole ministry of health got less than 1bn naira for a whole calendar year.

Tinubu spent over 100bn naira to purchase aircraft for himself and budget less than 50bn naira for student loans.

Many more. Tell me how that revenue problems doesn’t affect the politicians but only the people.