The figure continues a strong upward trend in government revenue, rising from ₦12.3 trillion in 2023 to ₦21 trillion in 2024 and ₦28.3 trillion in 2025. But the increase wasn’t driven by one policy alone.

It was the result of several tax reforms working together to improve revenue collection and reduce leakages.

Digital Tax Administration Is Producing Results

One of the biggest contributors has been the continued digitalisation of Nigeria’s tax administration.

The rollout of the national electronic invoicing system for large taxpayers, alongside wider use of digital tax systems, has made it easier to monitor transactions, improve reporting, and reduce manual processes.

As more businesses adopt digital tax processes, revenue collection becomes more transparent and efficient.

The New Tax Reform Laws Are Beginning to Take Effect

The implementation of the four tax reform laws that came into effect in January 2026 has also strengthened revenue collection.

Rather than focusing only on collecting more taxes, the reforms are designed to modernise tax administration, improve coordination, and create a system that encourages better compliance across different sectors of the economy.

Executive Order 9 Closed a Major Revenue Leak

Another major contributor was Executive Order 9, signed in February 2026.

The order requires upstream oil and gas companies to remit royalties, taxes, and production sharing contract profit oil directly into the Federation Account instead of allowing deductions before remittance.

The impact was immediate.

Monthly Federation Account receipts increased significantly after the order took effect, highlighting how closing long standing leakages can improve government revenue without introducing new taxes.

Non Oil Revenue Is Becoming More Important

One of the most interesting findings is that 76 percent of total collections came from non oil taxes.

For years, Nigeria relied heavily on oil revenue.

That is gradually changing.

A broader tax base means government revenue is becoming less dependent on the performance of the oil sector and more supported by businesses, services, and other parts of the economy.

Nigeria’s Tax to GDP Ratio Is Improving

The reforms have also pushed Nigeria’s tax to GDP ratio from 10.3 percent to 13 percent.

While this remains below the government’s long term target of 18 percent, it shows that tax collection is improving relative to the size of the economy.

There is still room for growth, but the direction is clear.

Why This Matters

The ₦21.6 trillion headline is more than a revenue milestone.

It shows that Nigeria is building a tax system that relies on stronger compliance, better technology, and fewer revenue leakages.

For freelancers, creators, consultants, remote workers, and business owners, the message is simple.

Keeping accurate financial records is becoming more important.

Businesses that maintain proper invoices, receipts, contracts, and expense records will be better prepared as Nigeria’s tax system continues to evolve.

At LessaTax, we help freelancers, creators, remote workers, and business owners stay organised before tax season arrives.

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