The Executive Chairman of the Nigeria Revenue Service, Zacch Adedeji, has said the Federal Government’s tax policy is not designed to extract money from Nigerians but to create an environment where individuals and businesses can prosper.
Adedeji said the revenue agency’s objective was to “tax prosperity, not poverty,” stressing that the government would focus on taxing economic returns rather than discouraging investment.
The NRS boss stated this while appearing on Channels Television’s Politics Today, where he defended the administration’s tax reforms and responded to concerns over rising government revenue and the economic hardship faced by Nigerians.
According to him, the government’s tax policy was built around the principle of taxing the fruits of investment rather than the investment itself.
He said, “For us at Nigeria Tax, we are not there to extract. Our focus is not revenue. I don’t want to tax poverty. I’m to tax the fruit, not the seed, and I’m to tax the return, not investment.”
Adedeji explained that the more profitable businesses became, the more revenue the government would generate without imposing excessive burdens on taxpayers.
He said if a company made N100, the government could collect N30 in tax, but if the company’s profit increased to N200 or N300, government revenue would also rise.
“So, if I want to make more, I must work for you to make more. And that is why it is in the best interest of us in Nigeria Revenue Service that businesses are doing well, individuals are doing well,” he said.
He said the approach was consistent with President Bola Tinubu’s economic agenda of removing obstacles to investment and creating a more conducive environment for businesses.
Adedeji cited the electricity sector as one area where the government had introduced reforms to encourage economic activity.
He noted that the Electricity Act had devolved powers to states to generate, transmit and distribute electricity, arguing that improved power supply would ultimately strengthen production and productivity.
According to him, electricity remains central to industrialisation because Nigeria’s economic challenge is partly linked to its inability to produce enough of what it consumes.
The NRS chairman also maintained that poverty reduction could not be achieved solely through federal government interventions, stressing the importance of state governments in providing basic services such as primary healthcare and education.
He said education, beginning from the early years through primary and secondary school, remained one of the most effective tools for lifting people out of poverty.
Adedeji also defended the government against criticism over increased revenue collection amid concerns about poor budget implementation and delays in capital expenditure.
He argued that revenue generation, budgeting, funding and financing were different aspects of public financial management and should not be conflated.
According to him, some major infrastructure projects were being implemented through funding structures that involved government contributions and private-sector financing.
He cited the Lagos-Calabar Coastal Highway and the Sokoto-Badagry Superhighway as examples of projects being supported through such arrangements.
He said the improved confidence in the Nigerian economy had made it possible for private investors and contractors to participate more actively in financing major infrastructure projects.
Adedeji said increased government revenue was also supporting interventions in agriculture and industrial development through institutions such as the Bank of Agriculture and the Bank of Industry.
He therefore rejected suggestions that the increase in revenue was not translating into economic development.
“When you ask where the increased revenue is going, it is going into a structure,” he said, pointing to infrastructure, agriculture, industrial development and other areas of government spending.
The NRS boss acknowledged concerns about Nigeria’s budgeting process, saying the Tinubu administration had recognised structural problems in the system and was working to address them.
He said the President had indicated that his administration would no longer tolerate the continuous rollover of budgets, describing budget reform as an important component of the government’s broader economic reforms.
Adedeji further argued that governance was a technical process that should be guided by principles, procedures and proper financial management rather than emotion.
He said the ultimate objective of the government’s economic policies was to create conditions that would enable businesses to expand, individuals to earn more and the tax base to grow.
“Tax prosperity, not poverty,” he reiterated, stressing that the government’s revenue strategy would be more sustainable when driven by economic growth and increased productivity rather than excessive taxation.
He expressed optimism about Nigeria’s economic outlook, saying the country’s future remained “very bright” following the reforms aimed at fixing the fundamentals of the economy.
(The Whistler)