By Ayo Onikoyi

“Nigeria’s new tax law marks more than a fiscal reform. It represents a turning point in the relationship between citizens and the state. By expanding the tax base, strengthening compliance, and formalising revenue collection, the reform draws more Nigerians directly into the financing of government. This shift inevitably raises a fundamental question: what exactly is the government doing with citizens’ money?

That question is where real development begins.

For decades, Nigeria’s dependence on oil revenue weakened the accountability link between government and citizens. Public finance functioned largely independently of popular contribution. As taxation becomes a more central revenue source, this dynamic changes. Citizens who contribute directly to public revenue become more attentive to how that revenue is managed, allocated, and translated into public goods.

If well implemented, the new tax regime could encourage a culture of civic ownership, where roads, schools, hospitals, security, and social protection are no longer abstract government projects but services funded by citizens themselves.

Digitalisation and Transparency as Enablers

The true potential of the new tax regime lies in its implementation, particularly through digitalisation. A fully digital tax system reduces human discretion, limits leakages, and creates verifiable audit trails. More importantly, it opens pathways for transparency.

Digital tax platforms can enable citizens to track collections, understand budget allocations, and follow how revenue is spent. Transparency should not stop at tax payment. It must extend to expenditure. Citizens should be able to see how tax revenue connects to projects, programmes, and services in their communities.

When transparency improves, accountability becomes unavoidable.

Beyond Revenue: The Case for Perceptive Fiscal Policy

Revenue mobilisation alone does not produce development. Development depends on how fiscal decisions are perceived by citizens and whether they can see fairness, equity, and value in the system. This principle forms the basis of Perceptive Fiscal Policy, a framework I have previously developed and written about.

Perceptive Fiscal Policy argues that fiscal measures must be economically sound and socially legitimate. Citizens must perceive fairness in tax enforcement, proportionality in burden sharing, and clarity in public spending outcomes. When fiscal policy is perceptive, compliance improves not through enforcement alone but through trust.

Nigeria’s new tax law presents an opportunity to operationalise this framework. Transparent digital systems, equitable enforcement, and visible development outcomes can transform taxation from a burden into a civic investment.

Leadership Accountability and Tax Clearance Declarations

Fiscal reform must begin at the top. A powerful signal of commitment would be for the President to publicly declare his tax clearance status and mandate the same for appointed ministers and senior public officials. This would reinforce the principle that no one is exempt from the obligations imposed on citizens.

Beyond executive action, legislation should make tax clearance declaration a mandatory requirement for all public office holders. Such a law would institutionalise accountability and align public leadership with the realities of taxpaying citizens.

When policymakers visibly comply with tax laws, public confidence in the system deepens.

Avoiding Taxation Without Trust

The greatest risk facing the reform is taxation without trust. In an economy already burdened by inflation and rising living costs, increased tax obligations without corresponding improvements in public services may fuel public resistance.

To avoid this, government must communicate clearly, spend responsibly, and demonstrate impact consistently. Digital transparency, leadership accountability, and citizen engagement must be treated as core pillars of reform, not optional additions.

Conclusion

Nigeria’s new tax regime is a test of governance maturity. It challenges citizens to contribute more responsibly and challenges the government to govern more transparently. If guided by digital transparency, grounded in Perceptive Fiscal Policy, and reinforced by leadership accountability, the reform could redefine Nigeria’s social contract.

Development does not begin when taxes are collected.​

It begins when citizens can see, understand, and trust what their taxes are doing.

Oluwaseun Adetutu is a development and public finance professional who has written on fiscal transparency and Perceptive Fiscal Policy.”