By Abiodun Abdullai
Chairman of the Presidential Fiscal Policy and Tax Reforms Committee, Taiwo Oyedele, says over 90 percent of Nigeria's informal sector operators lack the capacity to pay taxes.
Speaking at an interactive session with journalists and public analysts on Friday, Oyedele said the notion that the informal sector holds untapped revenue potential for the government is largely misplaced.
"This is the reason why Nigeria has ended up introducing multiple taxes — because we keep chasing the informal sector. More than 90 percent of operators there are just struggling to survive," he said.
According to him, many informal workers — such as roadside food vendors, vulcanisers, and wheelbarrow pushers — earn only enough to get by and should not be taxed.
"If someone is roasting corn by the roadside and has customers all day, that person is still poor. They have no capacity to pay taxes and should not be taxed," he stated.
Oyedele noted that President Bola Tinubu's position on tax policy aligns with this philosophy, emphasising that "poverty and capital should not be taxed."
"We should not tax the seeds but wait for the fruits," he said.
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He explained that the country's new tax laws are designed to tighten accountability, curb corruption, and improve transparency across revenue agencies.
According to him, while the Federal Inland Revenue Service (FIRS) collected over ₦20 trillion in taxes last year, new structures have been put in place to ensure stronger governance and public accountability.
"There are now provisions in the new tax laws that hold tax officers personally liable for misconduct. The reforms have strengthened the system to ensure diligence, transparency, and accountability," he said.
The fiscal policy chief added that leakages have been eliminated as all taxes now go directly into the federation account rather than accounts controlled by the FIRS.
On corruption within the tax system, Oyedele noted that taxpayers, tax officers, and consultants had all contributed to past malpractices but stressed that the new reforms now provide mechanisms to address all parties.
"As a taxpayer, trying to evade tax is now more expensive under the new law. Consultants are being monitored for compliance, and tax officers now face greater risks for unethical practices," he said.
He expressed confidence that the reforms will create a fairer and more efficient tax system that encourages compliance without overburdening small and struggling businesses.
