The Executive Chairman of the National Revenue Service (NRS), Zacch Adedeji, has said Nigeria would have faced severe fiscal strain if fuel subsidy had not been removed, warning that the policy could have consumed up to 76 per cent of the country’s projected N68 trillion budget.
Speaking on Tuesday at the commissioning of the NRS headquarters in Abuja, Adedeji described the removal of fuel subsidy as a crucial decision that helped prevent an economic crisis.
According to him, based on an oil price benchmark of $120 per barrel, subsidy payments alone could have cost the country about N52 trillion, leaving little room for capital projects, social services and other government obligations.
He said the reform had helped stabilise public finances and improve Nigeria’s external reserves, which he put at about $34 billion, compared to a projected $2 billion if subsidy payments had continued.
Adedeji added that the administration’s broader economic reforms—including foreign exchange adjustments and tax restructuring—have strengthened revenue generation, improved transparency and boosted investor confidence.
He also disclosed that Nigeria’s total revenue has risen significantly in recent years, from N6.82 trillion five years ago to about N28.7 trillion in 2025. According to him, allocations to states also increased from N711 billion in May 2023 to N3.6 trillion by September 2025.
The NRS boss said the government has focused on improving efficiency rather than increasing tax burdens, noting that over 60 fragmented tax laws have now been streamlined into a more unified framework.
He described the newly commissioned headquarters as a symbol of institutional reform, adding that the facility—capable of housing over 3,000 staff—would enhance service delivery, innovation and operational efficiency in revenue administration.
The Minister of Finance and Coordinating Minister of the Economy, Wale Edun, also praised the reforms, saying they reflect a major transformation in Nigeria’s fiscal governance structure.
Represented by the Minister of State for Finance, Taiwo Oyedele, Edun said the transition from the Federal Inland Revenue Service to the NRS represents more than a rebranding, but a structural shift toward stronger accountability and improved revenue management.
He noted that Nigeria’s fiscal system had previously suffered from fragmented tax laws and weak coordination but said ongoing reforms were correcting these inefficiencies and improving collections.
Edun also emphasised the role of technology in strengthening compliance and boosting transparency, adding that investment in tax administration could generate significant returns.
“Every 1 naira invested in tax administration can return up to 10 times in revenue,” he said, suggesting that revenue targets could now be increased as efficiency improves.
Adedeji commended President Bola Tinubu for what he described as bold economic decisions, saying they have repositioned Nigeria’s economy and laid the foundation for sustainable growth.
