President Bola Ahmed Tinubu has blamed Nigeria’s colonial‑era and legacy tax laws for deepening poverty, arguing that their fragmented structure and unfair burden left ordinary citizens carrying the heaviest load while stifling productive enterprise. He said these outdated rules discouraged investment, pushed many businesses into the informal economy, and punished compliance instead of rewarding it.
“Old Tax Laws Made Nigerians Poor” – Tinubu’s Message
At the commissioning of the Nigeria Revenue Service headquarters in Abuja, Tinubu declared that “old tax laws made Nigerians poor,” stressing that many of the rules inherited from the colonial era were never properly reformed for a modern, inclusive economy. He criticized a system that is fragmented, multiplicative and inconsistent, where different tiers of government layered levies on citizens and businesses without coordination or clarity.
He argued that this architecture discouraged job creation, pushed vulnerable workers and small entrepreneurs deeper into hardship, and failed to tap the full productive potential of the country. In his view, no serious nation can achieve lasting prosperity on the back of a weak, chaotic revenue framework that treats low‑income earners and powerful corporations almost the same in practice.
What Was Wrong with the Old Tax System?
Several structural flaws underlie Tinubu’s argument:
- Colonial‑era design: Many core laws were drafted to extract revenue for the colonial administration, not to build a broad middle class or support domestic industry.
- Multiplicity of taxes: Federal, state and local authorities created overlapping levies, permits and fees that made the cost of doing business unpredictable and high.
- Weak progressivity: In practice, low‑ and middle‑income earners often faced rigid statutory deductions and broad consumption taxes, while high‑net‑worth individuals and large firms had more room to exploit loopholes.
- Poor compliance and administration: A narrow formal tax net meant government leaned heavily on those already captured, amplifying the burden on a small segment of workers and businesses.
Tinubu’s framing is that this mix squeezed disposable income, slowed growth and deepened poverty, especially in states already grappling with low investment and limited formal employment. For regions like Benue, where agriculture and small trade dominate, unstable and overlapping taxes on transport, produce and micro‑enterprises made survival more difficult for local producers and traders.
Tinubu’s New Tax Reform Agenda
Tinubu’s government is rolling out a broad tax‑reform agenda aimed at turning the revenue system into an engine of growth rather than a persisting source of hardship:
- New finance and tax laws: Over the past two years, the administration has signed multiple finance bills and a re‑gazetted tax law package aimed at simplifying the regime and updating colonial‑era provisions.
- Centralised administration: The creation and strengthening of the Nigeria Revenue Service is meant to reduce fragmentation, harmonise collections and cut back on arbitrary levies by multiple agencies.
- Shielding the poor: The administration insists that the new framework exempts the vast majority of poor Nigerians from direct taxes and focuses more on profits and consumption among wealthier segments.
- Growth and compliance: Officials argue that a fairer, clearer system will expand the tax net, encourage voluntary compliance and give government the stable revenue needed for infrastructure, healthcare and education without “taxing poverty.”
Tinubu presents these changes as a pivot from a revenue model that merely extracts, to one that aims to stimulate productivity and broaden prosperity. He insists that the success of the reforms will be judged not just by how much government collects, but by how much opportunity and higher living standards they create over time.
What This Means for Local Entrepreneurs
For everyday Nigerians, the promise of the new regime is a tax system that is simpler to understand and less punitive for low‑income earners, even as enforcement tightens on large players and consumption in more affluent brackets. If implemented faithfully, this could free up more disposable income at the bottom and reduce the arbitrary charges that often plague traders, artisans and small farmers.
In the context of “Made in Benue” and similar homegrown initiatives, a cleaner, more predictable tax environment could lower barriers for agripreneurs, manufacturers and creatives trying to build value chains from farm to finished product. Local producers still face headwinds from inflation, infrastructure gaps and insecurity, but Tinubu’s message is that the tax system—once a tool of impoverishment—must now become an enabler of local enterprise and shared prosperity.
