THE Chairman of the Nigeria Revenue Service (NRS), Zacch Adedeji, has described the removal of petrol subsidy as the best thing to have happened to Nigeria, saying President Bola Tinubu deserves commendation for taking the decision.
News Point Nigeria reports that Adedeji made the remarks in an exclusive interview on Channels Television’s Sunday Politics programme, where he defended the administration’s economic reforms and argued that many of the positive economic outcomes currently being recorded are largely connected to the decision to remove the subsidy.
According to him, the subsidy regime was unsustainable and detrimental to Nigeria’s economy and had remained in place for decades despite its negative consequences.
“All the good results that I will reel out soon come as a result of that courageous decision (subsidy removal). So, it is not a mistake; it is the best thing that has happened to this country. Subsidy was evil and had been with Nigeria for decades,” he said.
Adedeji said President Tinubu inherited an economy characterised by an unsustainable subsidy regime, an underperforming oil sector and a narrow tax base, arguing that the administration had since taken fundamental steps to address those structural challenges.
He maintained that the government’s economic decisions should not be assessed through emotions, insisting that the reforms were necessary to reposition the economy and create a more sustainable foundation for growth.
The NRS chairman also dismissed criticism of the reforms, saying the administration had fundamentally altered Nigeria’s economic structure in ways that some of its critics might not yet fully appreciate.
According to him, those seeking to challenge the Tinubu administration ahead of the 2027 elections should explain how they intend to handle the country’s economic challenges differently.
“What the President deserves now is support and commendation for being a statesman and not a politician. Anybody who says he is coming (to contest as president), just ask them, ‘What will you do differently?’
“Are they saying that it is wrong that we removed fuel subsidy? Are they saying that it is wrong that we unified the rate?” he asked.
Adedeji argued that retaining the subsidy would have placed an even greater burden on the country’s finances, particularly amid pressures created by developments in the global energy market and the Iran crisis.
According to him, had the subsidy remained, Nigeria’s subsidy bill could have risen to about ₦53 trillion, while the exchange rate could have reached as much as ₦3,500 to the dollar.
President Tinubu announced the removal of petrol subsidy during his inaugural address on May 29, 2023, a decision that triggered a sharp increase in petrol prices and contributed to higher transportation, food and production costs.
The policy has, however, also contributed to increased government revenues and higher allocations to the three tiers of government through the Federation Account. While the reform has strengthened government finances, its effect on the cost of living has remained a major concern for households and businesses.
Adedeji said the focus of the NRS was to tax prosperity rather than poverty, stressing that increased revenue would naturally follow when businesses and individuals perform better.
Responding to concerns about the state of the economy, particularly amid weak household incomes and high levels of poverty, the NRS chairman said the revenue service was not established to extract money from struggling Nigerians.
“We are not there to extract, and that is Mr President’s policy. Honestly, our focus is not revenue. If you remember, Mr President’s cliché is that I am to tax prosperity. I don’t want to tax poverty. I’m to tax the fruit, not the seed, and I’m to tax the return, not investment.
“So, for us, it’s not extracting. We are not there to extract. And that is why Mr President is creating a conducive economic environment,” he said.
Adedeji explained that the revenue service’s interest was directly tied to the performance of businesses and individuals, noting that higher earnings would ultimately translate into higher tax receipts.
“When business does well, the Nigerian revenue will do well, so we are not there to extract. That is not our focus. That is why you see more of my job as Chief Tax Officer is to make sure that businesses are doing well, because if you make 100 naira, I will take 30 naira. If you make 200, I will take 60. If you make 300, I will take 90.
“So, if I want to make more, I must work for you to make more. And that is why it is in the best interest of us in the Nigeria Revenue Service that businesses are doing well and individuals are doing well,” he said.
The NRS chairman also linked the government’s economic reforms to efforts to remove obstacles to business growth, citing reforms in the power sector and increased allocations to state governments as part of the broader strategy.
He said state governments had a critical role to play in reducing poverty because of their proximity to citizens, particularly in areas such as primary and secondary education.
He also cited the establishment of the Nigerian Education Loan Fund (NELFUND) as another Federal Government intervention designed to improve access to opportunities that could help Nigerians strengthen their economic prospects.
“For us in Nigeria Revenue Service, it’s not about extracting. It’s about making the country prosperous. Mr President has said it publicly. We are not here to tax poverty. We are here to tax prosperity. That is what our duty is, to make sure people prosper. That is our responsibility,” he said.
On criticism that increased government revenue had not translated into corresponding capital expenditure, with some lawmakers raising concerns about budget implementation and the carry-over of projects, Adedeji said revenue generation and budget expenditure were separate issues.
He described the difference between the two as “total,” urging critics not to conflate the revenue-generating process with the government’s expenditure framework.
“No, and that is the understanding that people should get. There is a total difference between the budgeting system and the expenditure framework,” he said.
Adedeji cited major infrastructure projects, including the Lagos-Calabar Coastal Highway and the Sokoto-Badagry Superhighway, as examples of major projects being pursued by the administration.
He further stressed that revenue collected by the NRS should not be viewed entirely as money available to the Federal Government, explaining that a significant portion of federation revenue is shared among the states and other tiers of government.
Adedeji’s comments came against the backdrop of Nigeria’s new tax regime, which took effect on January 1, 2026, replacing several existing tax laws with four principal pieces of legislation covering taxation, tax administration, revenue collection and taxpayer disputes.
Under the new regime, individuals earning up to ₦800,000 annually are exempt from personal income tax, while higher earners are subject to progressive rates of up to 25 per cent. Eligible workers can also claim limited rent relief.
For businesses, small companies with annual turnover below ₦100 million are exempt from Companies Income Tax, while larger companies generally pay 30 per cent CIT alongside a four per cent development levy. Large multinational companies are also subject to a 15 per cent minimum effective tax rate.
The Value Added Tax rate remains 7.5 per cent, while basic food items, medicines, healthcare and education are among essential goods and services that receive zero-rating.
The reforms also expand capital gains taxation to cover assets including cryptocurrencies and other digital assets, while introducing stricter compliance measures, including the use of the National Identification Number as a Tax Identification Number.