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More than 90 per cent of workers in Nigeria’s informal sector lack the capacity to pay taxes, according to Taiwo Oyedele, Chairman of the Presidential Fiscal Policy and Tax Reforms Committee.
Oyedele made a remark on Friday during an interactive session with journalists, influencers, and public analysts on the country’s new tax laws.
He dismissed the widely held belief that the informal sector holds vast untapped revenue potential.
“This is why Nigeria has introduced multiple taxes — we keep chasing people in the informal sector,” he explained. “But the reality is that over 90 per cent of them are simply trying to survive, living hand to mouth. They have no capacity to pay taxes.”
He illustrated his point with examples: “If someone is roasting corn on the roadside, even if they have customers all day, they remain poor. A vulcaniser with steady business or a wheelbarrow pusher working all day is still struggling. They shouldn’t be taxed.”
Oyedele added that this is why President Bola Tinubu insists that poverty and capital must not be taxed. “We should not tax seeds but wait for the fruits,” he said.
The fiscal chief noted that Nigeria’s new tax laws have made tax evasion far costlier for both individuals and professionals. While the Federal Inland Revenue Service (FIRS) collected over ₦20 trillion last year—and is on track to exceed that figure—the reforms now include tighter structures and greater accountability.
“These new laws have introduced more provisions and requirements to ensure diligence and responsibility,” Oyedele stated. “In some cases, there are now personal liabilities for officers who fail to perform their duties. The FIRS must also present and publish reports, which they were not previously required to do.”
He added that reforms have also closed loopholes, ensuring all tax revenues now go directly into the federation account instead of accounts controlled by the FIRS.
On corruption within the tax system, Oyedele said taxpayers, consultants, and tax officials had all played roles in past malpractices.
“The new laws now address all parties,” he said. “For taxpayers, evasion is now more expensive. Consultants must register and are closely monitored. And for tax officers, the risks of non-compliance are now higher. Overall, these changes will make the tax system more transparent, accountable, and effective.”
