Speaking on the implementation of the country’s new tax laws, Adedeji explained that informal businesses, by their very nature, fall outside the scope of structured taxation and can only be brought into the tax net through formalisation. According to him, encouraging informal operators to register, grow, and operate within recognised structures remains the only sustainable pathway to taxing that segment of the economy.
“On the informal sector, you cannot tax what is informal. That is why they are called informal,” Adedeji said. “To tax them, you must first formalise them. Encourage them to register and grow. Once they are formal, they fall into proper categories and can be taxed accordingly.”
He noted that the NRS is placing strong emphasis on education, engagement, and stakeholder outreach to achieve this goal. The service, he said, has dedicated departments for media, engagement, and stakeholder relations to ensure that tax solutions are tailored to different groups, particularly small and medium-sized enterprises.
“Our goal is to help small businesses grow or, at the very least, sustain themselves,” he added.
Addressing concerns around Value Added Tax (VAT), Adedeji dismissed claims that the tax disproportionately affects poor Nigerians. He clarified that VAT is a consumption tax with clear exemptions and is not targeted at the poor. According to him, the Nigeria Tax Administration Act (NTAA) 2025 was deliberately structured to reduce the tax burden on low-income earners.
“The aim of the NTAA 2025 is to remove the burden of tax on the poor,” he said, adding that under the new tax regime, only income or profits are taxed, not capital or investments.
He said the recent tax reforms have restored clarity, capacity, and accountability in Nigeria’s tax administration, while improved technology and streamlined processes have enhanced revenue tracking and transparency.
Adedeji further pointed out that globally, fewer than 10 per cent of the population typically pays direct taxes, stressing again that VAT is not imposed on the poor. He also assured businesses that under his leadership, no company would be shut down solely for noncompliance with tax obligations.
“If I want revenue to grow, I must help you grow. I am not here to suffocate businesses,” he said. “I am not a policeman or someone chasing bandits. I am like a farmer who prunes a tree so it can bear more fruit.”
He explained that audits are now integrated into routine tax operations, with auditors working alongside tax officers to guide businesses rather than punish them. Tax service partners, he said, have also been deployed across operations to assist businesses, explain obligations, and ensure compliance without disrupting productivity.
“Sales lost today can never be recovered. If a business does not make profit, there is nothing to tax,” Adedeji noted.
On the controversial tax credit scheme, the NRS chairman said his administration discontinued it due to widespread abuse and because it placed tax authorities in the role of project supervisors, a responsibility he said fell outside the service’s mandate and competence.
“Tax credit is not within NRS’ remit,” he said, adding that the agency lacks the technical capacity to assess and supervise infrastructure projects.
Adedeji described VAT reforms as one of the most significant outcomes of the current tax overhaul, noting that they have increased the flow of financial resources to state governments. He also explained that the federal government’s decision to exempt food and agricultural items from VAT was aimed at curbing food inflation and making essential commodities more affordable.
He identified information gaps as one of the biggest challenges facing the implementation of the new tax regime, stressing that building public trust remains central to the reform agenda.
“Trust is critical. People must first believe that government is not trying to make life harder. That understanding is the foundation,” he said. “We are listening. Where something is not working, we will adjust.”
On accountability and compliance, Adedeji emphasised that tax compliance is a legal obligation, not a choice. He noted that in many countries, citizens pay as much as 40 per cent of their income in taxes, and that benefits often follow compliance, not the other way around.
“We must ask ourselves if we are ready for the Nigeria we talk about,” he said, adding that government officials are also being held accountable for how tax revenues are spent. According to him, increased public scrutiny signals the end of an era in which citizens were taken for granted.
Adedeji also addressed concerns about tax deductions, non-remittance, and the fear that personal bank balances could be taxed. He firmly stated that individual bank account balances are not taxable, describing such fears as unfounded.
“Your bank account is your asset. Nobody has the right to tax your bank balance,” he said. “Money in your account does not automatically mean profit.”
He explained that salaries are deductible expenses and that proof of salary payments is tied to evidence of tax remittance, making the system largely self-regulating. He also noted that under the consolidated tax law, revenue agencies can no longer claim costs of collection but only costs of operation, reinforcing the principle that government must adequately fund its agencies.
“I don’t generate revenue; I only collect revenue,” Adedeji said. “My job is to ensure businesses and individuals do well. When they do well, revenue comes automatically.”
He concluded by stressing that sustainable revenue growth depends on creating a conducive business environment rather than harassment, adding that transparency, rule of law, and openness will remain non-negotiable under his administration.