Tax Revenues Rise Sharply in First Half of 2025
The federal government recorded a total tax revenue of N14.27 trillion between January and June 2025 — a 43% increase over the N9.98 trillion generated in the same period of 2024. This significant rise far surpassed the government's baseline growth target of 16.4%, indicating stronger fiscal performance than expected.
According to a report from the presidency, non-oil tax collections accounted for N10.64 trillion in H1 2025, representing a 44.2% increase compared to N7.37 trillion in the corresponding period of 2024. Meanwhile, oil tax revenue rose to N3.63 trillion, a 39.4% increase from N2.60 trillion previously.
The government attributed this strong performance to expanded revenue diversification, improved compliance measures, and enhanced enforcement by the Federal Inland Revenue Service (FIRS). The 2025 revenue target maintains a growth benchmark of 16.4% over 2024 collections, which the current trend suggests may be achievable if momentum continues.
GDP Rebasing Reveals a Larger, More Diversified Economy
In a related development, the federal government announced revised GDP figures following a comprehensive rebasing exercise—the first since 2014. According to the National Bureau of Statistics (NBS), Nigeria's economy grew nominally from N205.09 trillion in 2019 to N372.82 trillion in 2024. When converted using the prevailing exchange rate of N1,529.53/$, the economy is valued at approximately $243.5 billion.
This rebasing reflects structural shifts in the economy, especially in service-oriented sectors. Notably, ICT, finance, entertainment, and professional services now play a larger role in GDP composition, while the oil sector’s share continues to decline. Real estate, too, emerged as a major contributor, ranking third in its impact on GDP.
Minister of Finance and Coordinating Minister of the Economy, Wale Edun, welcomed the revised figures, describing them as "critical tools for realistic policy formulation" and a reflection of Nigeria’s evolving economic structure. He added that the data underscores the importance of investing in infrastructure, digital innovation, and human capital to drive inclusive growth.
Mixed Reactions: Reforms Applauded, Challenges Remain
Despite the positive headline numbers, analysts and industry leaders were quick to temper expectations. Many noted that the rebased GDP, while offering clarity, paints a sobering picture of the work still required to achieve the government’s ambitious $1 trillion economy target by 2030.
Dr. Muda Yusuf, economist and CEO of the Centre for the Promotion of Private Enterprise (CPPE), noted that the rebasing exercise revealed structural changes, including an expanded informal sector and improved reporting on previously underrepresented segments such as water transport. He projected the economy may reach $400 billion by the end of 2025, but cautioned that reaching the $1 trillion target remains a “tough call.”
Dr. Chijioke Ekechukwu, of Bristol Investments Limited, echoed these sentiments. He argued that to achieve meaningful growth, Nigeria must accelerate industrialisation and improve agricultural productivity, particularly through modern methods like greenhouse farming in all states.
Economic Resilience Versus Real-World Hardship
While the government points to a 3.13% GDP growth in Q1 2025—an improvement from 2.4% in Q1 2024—as evidence of resilience, observers warn against relying too heavily on macro-level optimism.
President of the Lagos Chamber of Commerce and Industry (LCCI), Gabriel Idahosa, described the rebasing as a statistical achievement that fails to reflect the realities faced by most Nigerians. He cited persistent high inflation, eroding purchasing power, and increased poverty, noting that “behind the optimistic figures lies our reality.”
He urged the government to transition from data celebration to strategic economic transformation, including tighter fiscal policies, exchange rate stabilisation, and stronger support for growth-critical sectors such as energy, infrastructure, and manufacturing.
The Path Ahead: Between Growth Targets and Structural Constraints
Analysts agree that the rebased GDP provides a more accurate foundation for planning. However, they stress that metrics such as tax-to-GDP ratio, debt sustainability, and income inequality will need to be addressed in tandem with revenue growth and policy reform.
Mr. Idakolo Gbolade, MD of SD&D Capital Management, warned that GDP growth alone does not translate to improved living standards. He called for smarter fiscal strategies and deeper institutional reforms to ensure the benefits of economic expansion reach ordinary Nigerians.
Conclusion
While the rise in revenue and GDP rebasing offer cause for cautious optimism, they also expose deep-rooted challenges. Achieving long-term economic transformation will require more than robust figures—it demands inclusive growth, policy consistency, and social impact.
Nigeria’s economic journey is clearly progressing, but whether it can meet the aspirations set for 2030 will depend not just on how much it earns, but how effectively it translates earnings into widespread development.