Nigeria’s informal economy is reeling under a harsh truth: over 90 percent of operators simply can’t afford to pay taxes, according to Taiwo Oyedele, chairman of the presidential fiscal policy and tax reforms committee.
Speaking at a recent media engagement with journalists, influencers, and public analysts, Oyedele dismissed the common belief that government coffers are teeming with untapped funds in the informal sector. “This is the reason why Nigeria has ended up introducing multiple taxes, because we are trying to chase people in the informal sector every now and then,” he said.
He painted a vivid picture of hardship:
“When in fact, more than 90 percent of operators in that sector are just there for survival. They are just trying to find how to put food on the table one day to another. They have no capacity to pay taxes.”
Even traders, roadside vendors, wheelbarrow pushers, and vulcanisers who manage to attract customers from dawn till dusk remain trapped in poverty, Oyedele remarked. “If somebody is roasting corn by the roadside … they are still a poor person. … They have no capacity to pay taxes and should not be taxed.”
He added that this philosophical stance underpins President Bola Tinubu’s decision that “poverty and capital should not be taxed,” and that the government must focus on taxing the yield, not the seed: “We should not tax seeds but wait for the fruits.”
“Tax evasion now expensive under new law”
Oyedele also revealed that Nigeria’s updated tax laws have strengthened enforcement and accountability. With the Federal Inland Revenue Service (FIRS) already surpassing last year’s N20 trillion collections, the new system is designed to be less forgiving on evasion.
“These new tax laws have put in place more structures, more provisions … to make sure that they do their work with responsibility … that they are more diligent,” he stated. Under the reforms, personal liability may now fall on officials who shirk their duties. Taxes will flow directly into the federation account, bypassing intermediaries prone to leaks.
In a bid to stamp out corruption, the law now regulates tax agents, monitors consultants’ actions, and places scrutiny on tax officers more than ever. “Trying to evade your taxes now is more expensive under the new tax law … there is a requirement for a registration of a tax agent,” he explained.
Oyedele said these changes aim to rebuild public trust by making the tax system fairer, more transparent, and less vulnerable to manipulation.
