Shettima: Debtservice burden fell to 68% in 2025 from 120% in 2022 amid tax reforms.

• Oyedele declares Nigeria cannot afford to delay tax modernisation, says reform aimed at growth not higher taxes

Vice President Kashim Shettima said the debt‑service‑to‑revenue ratio fell sharply from 120 percent in December 2022 to 68 percent in 2025, a change he attributed to the tax reforms being implemented by President Bola Tinubu’s administration.

Finance Minister Taiwo Oyedele added that the reforms are intended to create a “stronger fiscal foundation for long‑term national development” rather than to raise tax rates.

The remarks were made at the opening of the 2026 Tax Conference, themed “Tax Reforms and Global Relevance: Positioning Nigeria’s Tax System for a Sustainable Future,” organized by the Chartered Institute of Taxation of Nigeria (CITN) in Abuja.

Shettima explained that the reforms serve as a key instrument for boosting government revenue, improving fiscal sustainability, and supporting the administration’s goal of expanding the economy to a $1 trillion output by 2030.

Speaking through Special Adviser to the President on Economic Affairs, Dr Tope Fasua, the vice president noted, “Many pundits have complained about our high revenue‑to‑debt‑servicing ratio. The only remedy is to generate revenue for the government through well‑designed and properly‑enforced fiscal laws.”

“We are on a solid course, as our current tax reforms are the primary engine for this leap and we have been able to close that chasm by bringing down this ratio from a galling high of 120 percent in December 2022, to 68 percent as at the close of 2025,” he said.

The reforms, which took effect on 1 January 2026, constitute Nigeria’s first comprehensive tax overhaul in more than 35 years and are aimed at repositioning the economy for sustained growth.

Shettima said the federal government is already streamlining tax administration and widening the tax base to improve the nation’s balance sheet and lessen the pressure from debt obligations.

“Every Naira recovered from inefficiency and every kobo brought into the net from previously untapped sectors is a brick in the bridge toward that $1 trillion milestone,” he said, adding that the reforms will help shift the country from “a nation that borrows to survive to one that invests to thrive.”

The vice president also affirmed the administration’s resolve to “break the shackles of high‑interest burdens that stifle our ability to fund education, healthcare, social services and infrastructure.”

He noted that President Tinubu inaugurated the tax‑reform committee, then led by Oyedele, shortly after taking office in May 2023 to address weak revenue generation and pervasive informality in the economy.

Shettima described the reforms as part of a broader effort to rebuild public infrastructure and enhance Nigeria’s global competitiveness.

He defended the reforms against criticism, pointing out that many Nigerians are unaware of their “pro‑poor” provisions, including the exemption for anyone earning N1 million or less.

“Some simply cannot believe that small businesses turning over N100 million and below every year are totally tax‑exempt,” he said.

He added, “It is not yet uhuru. We face daunting challenges in our quest for a new, greater Nigeria. The innards of the tax reform must be disseminated far and wide. Many Nigerians are yet unaware, even of the pro‑poor nature of the reforms and how it favours the under‑privileged amongst us.”

“Many Nigerians don’t know that anyone earning N1 million and below will go tax‑free in Nigeria. Some simply cannot believe – because it has never happened before – that small businesses turning over N100 million and below every year are totally tax‑exempt. They must be constantly reminded that President Tinubu is not anti‑people or anti‑business, but pro‑people and pro‑business.”

“He wants Nigerians to thrive and succeed, and we shall work to ensure this. Information dissemination on these reforms is key and we must never yield the entire space to the traducers of government who seek to impugn the good efforts of our leader, by substituting progressive information with concocted information and falsehood.”

Shettima stressed, “Tax reform is often seen as a technical burden, but I urge you to see it as an act of patriotism. We are not just reforming a system; we are reclaiming our destiny.”

Earlier, Oyedele reiterated that the reforms aim to build a stronger fiscal foundation for long‑term national development rather than to increase taxation.

He said the country’s previous tax system had been weakened by fragmented administration, multiple taxation, weak compliance and unstable revenues.

According to him, “Countries that fail to modernise their fiscal frameworks risk losing competitiveness, discouraging investment, widening inequality, and weakening economic resilience. These are risks Nigeria cannot afford to take, and opportunities we cannot afford to lose.”

The minister explained that the reforms are designed to simplify taxation, reduce compliance burdens, encourage investment and strengthen public trust in government.

He disclosed that minimum‑wage earners have been exempted from personal income tax, and that measures are being introduced to lessen the burden on low‑income earners and improve business competitiveness, among other initiatives.

“Our tax reforms became necessary because, for many years, Nigeria’s tax system suffered from structural weaknesses — from non‑harmonised taxes to fragmented administration, scarce and unstable revenues, weak compliance, and high levels of informality,” he said.

“Businesses faced numerous impediments from inefficient enforcement and rising compliance costs. Citizens often perceived the tax system as unfair because the burden was unevenly distributed. At the same time, revenues remained insufficient relative to our development targets.”

“This model became untenable, and the system was simply unsustainable. The reforms we are implementing are therefore not about additional points of taxation. They are about building a stronger fiscal foundation for long‑term national development.”

Oyedele stressed that the government’s approach is guided by the conviction that a good tax system should enrich the real economy, support growth, protect vulnerable groups, and strengthen trust between government and citizens.

He said the reforms seek to simplify the tax system, improve coordination, reduce disruptions, encourage investment, promote voluntary compliance, and align taxation with productivity.

“We are moving from a framework driven by discretion and fragmentation to one anchored on clarity, certainty, and fairness,” he said.

“We do not operate in isolation. We must remain competitive, and competitiveness today depends significantly on the quality of a country’s fiscal architecture. This is why our reforms incorporate internationally recognised best practices while remaining sensitive to Nigeria’s realities.”

The minister noted that one of the strongest complaints from businesses had been multiple taxation across different levels of government, and said the government is working to modernise tax