The Executive Chairman of the Federal Inland Revenue Service (FIRS), Zacch Adedeji, says Nigeria must begin selecting roads, ports, and energy projects “based on their economic returns” and capacity to drive sustainable growth if it intends to overcome its dwindling revenue challenge.
Adedeji made the recommendation while delivering a public lecture at the University of Ilesa’s Founders’ Day on Friday.
According to him, adopting economic returns criteria is one of four strategic policy actions necessary for Nigeria to reverse declining revenue and build long-term fiscal stability.
Overcoming Dwindling Revenue
To address Nigeria’s revenue pressures, Adedeji called for increased Domestic Revenue Mobilization (DRM) aimed at broadening and deepening the country’s tax base.
He stressed the need to generate more revenue fairly, efficiently, and sustainably moving beyond the narrow pool of large formal companies to effectively capture economic activity in the informal sector, the digital economy, and high-net-worth individuals who, he noted, still remain outside the tax net.
Adedeji added that with digital tools such as TaxPro Max, e-TCC, and tax intelligence systems, the FIRS is closing compliance gaps and improving collections.
He further emphasized the importance of improving budget credibility, ensuring that appropriations align with actual implementation without recurrent deviations or funding shortfalls.
The FIRS Chairman also urged strict adherence to fiscal rules, including debt ceilings, savings benchmarks, medium-term expenditure frameworks, and transparent procurement processes to enhance accountability and sustainability.
Adedeji noted that economic diversification and targeted investment in infrastructure—particularly roads and ports—must be guided by data and clear economic impact.
“Infrastructure development should be strategic, data-informed, and private-sector aligned,” he stated, adding that diversification requires “capital, coordination, and courage.”
He also called for stronger institutional reforms and improved inter-agency collaboration, including enhanced autonomy and capacity for agencies such as the FIRS, Customs Service, and the Budget Office.
What To Know
Adedeji’s comments come as Nigeria’s 2024 internally generated revenue (IGR) analysis reveals widening disparities between high-earning and low-earning states.
Nairametrics research shows Lagos, Rivers, and the FCT continue to dominate subnational revenue performance, while several states remain heavily dependent on federal allocations to fund their budgets.
According to data analyzed by Nairametrics, the 36 states and the FCT generated a combined N3.63 trillion in 2024, up from N2.43 trillion in 2023—representing 49.69% growth.
However, the bottom 10 states contributed only 5.23% of the total IGR, underscoring deep-seated structural and economic weaknesses at the subnational level.
