Kemi Adeosun reveals ambitious plans to double tax to GDP ratio to 12% over the next three years

FINANCE minister Kemi Adeosun has announced ambitious plans to double Nigeria's tax to domestic gross product (GDP) ratio to 12% by 2020 as part of the government's plans to end the dependency on crude revenue.

Nigeria currently has one of the lowest tax to GDP ratios in the world, which at 6% is very low even by African standards. Due to the government's over-dependence on crude oil revenue, very little has been done to generate income from other sources, making Nigeria very vulnerable to the vagaries of world prices.

Speaking in New York, Ms Adeosun said that Nigeria was among the lowest tax-paying country in the world. She said this while participating on a panel discussion titled Revenue Leakages: Illicit Financial Flows at a tax conference at the United Nations headquarters.

Ms Adeosun said: “We’ve made it the focus to improve our tax to GDP ratio from 6% where it currently is to move it up to the level of other African countries. Ghana has 15%, South Africa has 24% and most developed countries have 30%, so Nigeria’s 6%  is very low.

“We need to correct that and we’ve driven a number of initiatives to do this. We shared some of our challenges with the panel and we got some very good advice and support which would be taken back to Nigeria to implement."