Nigeria’s tax revenue surged 49% in the first five months of 2026, reaching 15.8 trillion naira (about $11.6 billion), as sweeping reforms to the tax system and new levies on the petroleum and mining sectors delivered a major boost to government collections.
The Nigeria Revenue Service (NRS), the rebranded federal tax authority, reported the sharp increase compared with 10.6 trillion naira collected in the same period last year. The performance significantly exceeded the government’s projected 11.6% growth target, signaling early success for President Bola Tinubu’s fiscal overhaul aimed at reducing reliance on volatile oil exports and improving domestic revenue mobilization.
Key Highlights:
Reforms and New Levies Drive Gains
Officials credited the jump to comprehensive tax reforms enacted in 2025, which streamlined administration, broadened the tax base, and introduced new compliance measures. Key among them are new levies on petroleum and mining industries, alongside higher collections from oil-related taxes fueled by elevated global crude prices linked to geopolitical tensions in the Middle East.
Even excluding the impact of entirely new taxes, revenue still rose about 15% to 12.2 trillion naira, highlighting underlying improvements in efficiency and enforcement under the leadership of tax reform architect Taiwo Oyedele.
The reforms include the Nigeria Tax Act and related legislation, which consolidated multiple levies, adjusted corporate tax rates for certain businesses, and introduced measures like a development levy on company profits. These changes aim to create a more predictable and business-friendly environment while plugging long-standing leakages.
Positive Outlook Amid Challenges
Supporters hailed the figures as evidence of structural progress. Former presidential aide Bashir Ahmad was among those celebrating, posting that “Nigeria is winning” and suggesting the stronger revenue position could reduce the need for heavy borrowing.
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The surge comes as Nigeria continues efforts to diversify its economy away from oil dependence. Non-oil revenues have increasingly become the dominant driver of fiscal performance in recent periods.However, analysts and critics caution that significant challenges remain. Despite the revenue gains, more than 63% of Nigerians continue to live in poverty, and questions persist about whether the additional funds will translate into tangible improvements in infrastructure, security, inequality reduction, or debt sustainability.
The strong first-quarter performance aligns with broader government targets for 2026, including ambitions to hit around $30 billion in combined tax and royalty collections for the full year. It also builds on momentum from 2025, when non-oil revenues showed robust growth.
Economists will be watching closely to see if this trajectory can be sustained, particularly as global oil prices fluctuate and implementation of the full tax reforms continues throughout the year. Nigeria’s tax-to-GDP ratio, historically among the lowest in the region, is expected to edge higher as a result of these measures, though it will likely remain below international benchmarks.
The government has signaled that further efficiency gains, digitization of tax processes, and expanded compliance will remain priorities to lock in these gains and support long-term fiscal stability.
