The National Orientation Agency has said Nigerians must fulfil their tax obligations before demanding accountability from government, stressing that tax compliance gives citizens the moral and legal standing to question how public resources are used.

A Programme Officer at the National Orientation Agency, Mrs Abiodun Olayeni-Ali, stated this on Thursday during an interactive session at the maiden edition of Civic Talks organised by the Centre for Inclusive Social Development in Abuja.

According to her, citizens who do not contribute to government revenue through taxes cannot legitimately demand answers from public officials.

“You have to pay your tax, and then you can hold your government accountable. Once you are not paying, it is difficult for you to really talk. If you are not paying tax, you have no right to ask what the government is doing”, she said.

She lamented that many Nigerians do not pay taxes, noting that the burden is largely carried by civil servants and a limited number of salaried workers.

“The majority of Nigerians do not pay tax. It is civil servants and a few people working in some companies that really pay tax in this country”, she said.

Olayeni-Ali also alleged that some companies manipulate payroll records to reduce the taxes deducted from their employees.

She said the National Orientation Agency had begun nationwide sensitisation campaigns to educate citizens about the new tax reforms and correct widespread misinformation that followed the announcement of the policy.

According to her, the agency operates offices in all the 774 local government areas of the country and conducts public enlightenment through community meetings, radio programmes and stakeholder engagements.

She added that participants at public events are expected to spread the information further within their communities.

Olayeni-Ali acknowledged that mistrust of government remains widespread but said Nigerians must recognise that public services are partly funded through taxes.

She cited public schools, government hospitals and other services as examples of benefits supported by government spending.

She said the agency’s ongoing public engagement campaign also forms part of a broader effort to rebuild trust between citizens and government through the National Value Charter initiative.

Business owners and informal sector operators, including POS operators, electricians and plumbers, who attended the event, expressed concern about the practical impact of the new tax reforms on already strained livelihoods.

Some participants said drivers and small traders often earn little after accounting for fuel, maintenance and other operational costs, questioning how they would meet additional tax obligations.

Others voiced scepticism about tax compliance, arguing that many Nigerians see limited visible benefits from government services.

Participants also highlighted confusion surrounding the reforms, including uncertainty about whether the policy had been suspended and how the proposed presumptive tax for the informal sector would work.

Reacting to concerns by business owners and informal sector operators, a Senior Programme Officer at the International Budget Partnership and public financial management specialist, Mr Iniobong Usen, said Nigeria’s tax reforms were designed to correct structural weaknesses in the country’s fiscal system.

He said one of the major problems with the previous tax framework was that it placed heavier burdens on low-income earners while wealthy individuals often paid little or no tax.

“Our tax system was regressive. The poorest and the most vulnerable carried the highest burden while the richest people did not pay their commensurate taxes”, he said.

Usen explained that the new personal income tax structure seeks to reduce pressure on low-income and middle-income earners while increasing contributions from higher-income individuals.

He added that the reforms also introduced a presumptive tax system aimed at simplifying taxation for informal sector operators who do not maintain financial records.

“For people who run small businesses but cannot keep records, the government proposes that they pay about one per cent of their turnover as tax,” he said.

Usen also said the reforms seek to eliminate multiple taxation and curb the activities of individuals who illegally collect levies from businesses.

“If you harass anybody to collect any levy, fee or tax, you can face a fine of up to N5m or imprisonment for three years,” he said.

Usen, however, stressed that citizens must become more involved in governance processes if they expect improved accountability.

A tax consultant and the Managing Partner at Lefort Consulting Limited, Ms Toyin Olufon, said the nationwide debate that followed the announcement of the tax reforms reflected growing public interest in fiscal policy.

Although the debate was initially characterised by panic and misinformation, Olufon said the engagement was a positive development.

“The fact that Nigerians were asking questions and engaging with the issues showed that we are on the right track,” she said.

She explained that personal income tax applies to individuals and sole proprietors, while company income tax applies to firms registered as limited liability companies.

Olufon also highlighted provisions in the new tax framework designed to encourage business growth.

According to her, companies with annual turnover below N100m and net assets below N250m are exempt from company income tax.

“That threshold creates room for small businesses to grow before they begin paying company income tax,” she said.

She added that several existing taxes had been consolidated into a single development levy of four per cent, simplifying compliance for businesses.

Olufon also pointed to the introduction of electronic invoicing as a key transparency measure in the value-added tax system.

“The e-invoicing system allows transactions to be transmitted directly to the tax authority. It will make it easier to verify VAT payments and process refunds”, she said.

Another tax consultant, Mr Telvin Inalegwu, said tax accountability would only improve if citizens actively monitor government spending.

“The tax we are talking about is what funds the budget,” he said. “But Nigerians do not follow the budget.”

He said citizens rarely track public projects or verify whether allocated funds are used for their intended purposes.

Inalegwu urged Nigerians to pay closer attention to public budgets and procurement processes, noting that such oversight is necessary to prevent misuse of public funds.

“If we pay taxes and follow the budget, we will know what belongs to us,” he said.

He added that proper documentation and record-keeping would enable businesses to benefit from tax reliefs and credits.

According to him, stricter penalties introduced under the new tax reforms would also help improve compliance.

He added that automation of the tax system would further reduce abuse and improve transparency in revenue collection.

In June 2025, President Bola Tinubu signed four sweeping tax reform bills into law, including the Nigeria Tax Act and related statutes that together overhaul decades-old tax statutes and modernise the country’s tax system. (PUNCH)

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