Nigeria’s Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, has cautioned that the country cannot continue to rely heavily on debt to finance development, stressing the need for a more resilient fiscal framework.
Speaking on Tuesday at the 28th Annual Tax Conference of the Chartered Institute of Taxation of Nigeria in Abuja, the minister said sustainable growth would require a system capable of funding essential sectors without excessive borrowing.
His remarks followed fresh reports that the Federal Government is in talks with the World Bank over a proposed $1.25bn loan aimed at supporting reforms, job creation and competitiveness.
“Nigeria cannot continue to finance development primarily through borrowing. We must build a fiscal system capable of sustainably supporting critical infrastructure, quality education, affordable healthcare, security, and social protection,” Oyedele said.
He explained that fiscal sustainability must go beyond raising revenue, noting that it should also foster inclusive growth, reduce inequality and improve productivity.
According to him, the government’s ongoing tax reforms are structured to correct long-standing weaknesses such as multiple taxation, fragmented administration, weak compliance and a narrow revenue base.
“Businesses faced overlapping debts, unpredictable enforcements, and rising compliance costs.
“Citizens often perceived the tax system as unfair because the burden was unevenly distributed,” he said.
Oyedele said the reforms are guided by a broader objective of strengthening the economy over the long term.
“Our approach is guided by a simple principle: a good tax system should raise revenue efficiently, support economic growth, protect the vulnerable, and strengthen trust between governments and citizens,” Oyedele said.
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He noted that the policy changes are intended to simplify tax processes, enhance fairness and attract investment while reducing distortions across sectors.
Oyedele disclosed that minimum wage earners have been exempted from personal income tax, while lower and middle income earners now face reduced tax obligations.
He added that the government is also considering cutting companies’ income tax rates to improve Nigeria’s competitiveness as an investment destination.
Vice President Kashim Shettima, who also addressed the conference, defended the reforms as beneficial to both citizens and businesses.
Represented by his Special Adviser on Economic Affairs, Tope Fasua, he said the administration is working towards building an economy where all Nigerians can thrive regardless of their background.
He added that efforts are ongoing to make Nigerian products globally competitive and to position the country’s tax system as a benchmark across Africa.
The Vice President acknowledged widespread public scepticism about the reforms.
“Many Nigerians simply cannot believe it because it has never happened before,” he said, while maintaining that President Bola Tinubu is committed to policies that support both businesses and citizens.
Shettima also stressed the need for stronger public awareness, describing tax reform as more than a fiscal measure.
He said it should be seen as “an act of patriotism” capable of driving national prosperity.