Experts Raise Alarm Over Nigeria’s Tax Reforms, Cite Due Process Gaps, Economic Risks

Nigeria’s tax laws are once again under intense scrutiny as development economists, tax law experts and policy analysts discuss due process. They warn that recent tax reforms may be undermining the rule of law, accountability and economic growth.

At a policy forum organised by the Abuja School of Social and Political Thought, experts dissected what they described as deep structural and legal flaws in Nigeria’s evolving tax regime. The forum, themed “Taxation, Rule of Law and Accountability in Nigeria’s Pirate Capitalism,” brought together economists and legal scholars.

They argued that taxation cannot be separated from governance, due process and constitutional order.

One of the central criticisms raised at the event was the growing tendency by government officials and public commentators to downplay the legality of tax laws in favour of revenue generation. Speakers argued that the notion that citizens should pay taxes regardless of whether laws were properly enacted sets a dangerous precedent.

“You can’t talk about tax without talking about due process,” one participant said. “If the process of making tax laws is defective, then the taxation system itself becomes illegitimate. Public finance is a subset of public governance.”

Constitutional and Structural Flaws

A development economist at the forum pointed to Nigeria’s constitutional framework as a root cause of its dysfunctional tax system. Sections 80 and 81 of the Constitution were criticised for discouraging fiscal responsibility and efficient resource mobilisation.

According to him, it mandates that federally collected revenues be pooled into the Federation Account and shared using a fixed formula.

Additionally, this centralised structure weakens the link between taxation, service delivery and accountability. It makes it harder for citizens to see the benefits of the taxes they pay. “It is not in any way helping the economy to achieve maximum development of the resources it has,” the economist argued.

There were also warnings that the complexity and inconsistency of the tax system could lead to selective enforcement. “If care is not taken, those who pay tax will go to jail, and those who do not pay tax will be free,” one speaker warned, describing the system as convoluted and prone to abuse.

In practical terms, critics argued that Nigeria’s new tax laws and enforcement methods are both flawed and repressive.

A key example cited was the effective tax burden on basic consumption. Participants highlighted that Nigerians are paying as much as 12.5 per cent tax on a plate of food, a situation they described as regressive in a country with high poverty and food inflation.

This, they argued, raises serious questions about claims that Nigeria’s tax-to-GDP ratio is low. “Either the taxes being collected are not entering the treasury for proper accountability, or the numbers simply don’t add up,” one analyst said.

Beyond tax rates, experts condemned what they described as aggressive and unorthodox collection methods, including the use of roadblocks, towing of vehicles and forceful enforcement tactics. Such methods, they said, erode public trust and further detach taxation from the principles of fairness and legality.