….reduce tax burden on Nigerians, CISLAC tells FG
As hardship grips Nigerians, Oxfam in Nigeria raised alarm on Tuesday over the alarming trend of over 99% of wealthy Nigerians evading taxes while millions suffer from hunger.
This assertion was made during the presentation of two comprehensive studies titled Income and Wealth Inequality in Nigeria: Trends and Drivers and Taxing the Rich: Fair Tax Monitor in Abuja.
According to Oxfam, the reports highlight a deepening inequality crisis across the country. Despite being the fourth-largest economy in Africa, the benefits of economic growth are disproportionately concentrated among a small elite, leaving millions of Nigerians trapped in poverty.
The studies were conducted by Oxfam in collaboration with the Tax Justice Network Africa and the Civil Society Legislative Advocacy Centre (CISLAC). They explore the structural causes of inequality in Nigeria, focusing on issues related to income, wealth, gender, and regional disparities. The findings are based on statistical data, expert analysis, and contributions from key policy stakeholders.
Oxfam’s analysis reveals a staggering wealth gap in Nigeria, calling for the adoption of progressive wealth taxation and increased social investment to bridge the growing economic and social divide before a potential social crisis erupts.
The reports indicate that only 40 of Nigeria’s wealthiest citizens are compliant taxpayers, according to the Federal Inland Revenue Service (FIRS) and John Bean Technologies Corporation (JBT). This represents a compliance rate of just 0.035%, implying that over 99% of the country’s wealthiest individuals evade or avoid paying taxes.
To address these issues, Oxfam urges the Nigerian government to implement several key measures:
Increase Social Spending: Currently, Nigeria allocates only 2-3.5% of its budget to education and 4-7% to healthcare, well below global standards. The government should raise social sector spending to at least 10% of the budget in health, education, and agriculture.
Implement Progressive Taxation: Establish a wealth tax targeting high-net-worth individuals. A 1% tax on net worth over $1 million could generate approximately $7.5 billion annually, which could fund critical social programs.
Invest in Human Capital Development: Enhance education, job creation, and healthcare, particularly in rural and underserved populations. Improving wages, reducing corruption, and expanding educational opportunities—especially for women and girls—will enhance Nigeria’s Human Development Index (HDI) by 2030.
Support Smallholder Farmers and Reform Agriculture: Strengthen policies that improve access to credit, land, and rural infrastructure for smallholder farmers. Prioritizing women’s land rights and promoting sustainable farming practices will help bridge the rural-urban divide.
Reform Land Policies: Establish a National Land Commission, conduct a National Land Audit, and ensure that land redistribution programs are transparent and inclusive, particularly regarding gender disparities.
Collaborate with Civil Society: Non-state actors, including civil society organizations, the private sector, and community groups, should advocate for pro-poor policies, hold the government accountable, and promote gender equality.
Develop a Comprehensive Wealth Registry and Strengthen Tax Enforcement: This will ensure that high-net-worth individuals contribute their fair share to the nation’s revenue.
In his address, Anwual Rafsanjani, Executive Director of CISLAC, urged the government to implement a Net Wealth Tax, raise the Capital Gains Tax to align with global best practices, and exempt basic goods from VAT while introducing luxury taxes on high-end items such as private jets, luxury cars, and yachts.
He further proposed that the government fully exempt Nigerians earning below the minimum wage or less than N840,000 annually from Personal Income Tax (PIT), while raising the top tax rate to at least 40% for the top 1%. Rafsanjani also advocated for the introduction of an Inheritance and Gift Tax targeting estates exceeding N50 million, along with renegotiating Double Taxation Agreements (DTAs) that disproportionately benefit multinational corporations to strengthen Nigeria’s tax sovereignty.