The International Monetary Fund (IMF) has urged the Nigerian government to consider higher taxes on fuel and telecommunications services as part of broader reforms aimed at strengthening public finances and increasing domestic revenue.
The recommendation was contained in the IMF’s latest Article IV consultation on Nigeria, where the Fund called for medium-term tax measures to improve government revenue while maintaining fiscal stability. It also advised the Federal Government to sustain ongoing economic reforms and enhance social protection for vulnerable households. (IMF)
According to the IMF, Nigeria’s tax-to-GDP ratio remains among the lowest in the region, leaving significant room for revenue mobilisation. The Fund argued that additional tax measures, including on fuel and telecommunications, could help reduce fiscal deficits and create more resources for critical public services and infrastructure. (Vanguard News)
The recommendation comes as millions of Nigerians continue to grapple with rising living costs following recent economic reforms, including the removal of fuel subsidies and foreign exchange liberalisation. While the IMF praised the government’s reform agenda for improving macroeconomic stability, it warned that poverty and food insecurity remain serious concerns and called for stronger support for low-income households. (IMF)
The Federal Government has yet to indicate whether it will adopt the IMF’s recommendation on fuel and telecommunications taxes.
