By Nnasom David

The Abuja School of Social and Political Thought (TAS) has urged the Federal Government to ensure that ongoing tax reforms strictly comply with constitutional provisions, warning that taxation must not be reduced to a mere revenue-generation exercise.

The call was made on Thursday in Abuja during TAS’ quarterly policy roundtable themed “Taxation, Rule of Law, and Accountability in Nigeria’s Private Capitalism.”

Speaking at the event, TAS Director, Dr Samuel Amadi, said tax policy should be treated as a social contract between the state and citizens, anchored on justice, accountability and inclusive economic growth.

Presenting a paper titled “Critical Perspectives on New Tax Regime: From Public Finance to Constitutional Governance and Social Justice,” Amadi said debates around taxation go beyond economics and must be situated within constitutional governance.

“Public finance issues are not just about money. They centre on constitutional governance and fundamental questions of justice,” he said.

While commending the government’s effort to streamline Nigeria’s tax system, Amadi stressed that reforms must follow due process and be backed by properly enacted laws.

“No tax policy should be enforced unless it is clearly stipulated by law. Constitutional economics must guide every fiscal decision,” he added.

Amadi argued that effective tax reform must prioritise social justice rather than aggressive revenue mobilisation.

“The idea of tax reform is good because it creates clarity and coherence. However, we must move beyond fiscal mobilisation to fiscal social justice,” he said.

According to him, taxation should help reduce poverty, boost consumer purchasing power and protect vulnerable populations. He noted that most Nigerians earn below N100,000 monthly and warned against policies that could become “extractive” toward low-income earners.

The TAS director recommended the creation of a visible social compact, where citizens receive clear information on how their taxes are spent.

He suggested a system in which taxpayers are issued notices detailing how revenue is invested in public goods such as healthcare, education and infrastructure, arguing that transparency would encourage compliance.

Amadi also referenced Adam Smith’s principles of taxation, fairness, certainty, convenience and efficiency, noting that good tax policy must promote redistribution, regulate consumption and stimulate local production.

Also speaking at the event, development economist Dr Friday Ohuche described taxation as a critical fiscal policy tool for economic growth but warned against regressive tax structures.

In his presentation titled “Nigeria’s New Tax Regime: Implications for Economic Growth and Equity,” Ohuche expressed concern over the informal sector, which he said accounts for about 60 per cent of Nigeria’s economy.

He warned that weak data systems could lead to aggressive taxation of informal workers who lack social protections, creating what he described as an “extractive tax trap.”

Ohuche also raised concerns about potential constitutional disputes between federal, state and local governments over revenue collection rights under the new regime.

He stressed the need for judicial oversight as Nigeria transitions from the Federal Inland Revenue Service to a more integrated revenue structure, to safeguard citizens’ rights and prevent abuse.

To eliminate corruption and multiple taxation, he called for simplified enforcement institutions and greater institutional transparency.

The economist recommended maintaining high tax-exempt thresholds for low-income earners and extending exemptions to educational startups and research-driven enterprises to support innovation.

He also urged the government to retain zero per cent Value Added Tax on educational materials, including digital learning tools and textbooks, to keep education affordable.

To address misinformation, Ohuche advised the government to partner with academic institutions to lead a nationwide tax literacy campaign explaining the new revenue framework and its implications for citizens.