Nigeria to end private consultants in revenue collection, focus shifts to digital systems

Taiwo Oyedele, the chairman of Nigeria’s Presidential Committee on Tax Policy and Fiscal Reforms, has clarified that the government has no plans to engage private consultants like Alpha Beta or other firms for revenue collection.

Instead, the focus is shifting toward a streamlined and technology-driven public system to boost transparency and efficiency in tax administration.

Oyedele made this disclosure while addressing concerns about the role of consulting firms in revenue collection, which has often drawn criticism over allegations of inefficiency, corruption, and lack of accountability.

He emphasized that the reforms aim to remove intermediaries and build a robust in-house mechanism for managing the country’s revenue streams.

Under the proposed reforms, the Federal Inland Revenue Service (FIRS) and other relevant government agencies will directly handle all aspects of tax collection, eliminating the need for private consultants.

Oyedele stated, “Our goal is to simplify the process, use technology, and reduce the cost of collection. Engaging consultants has proven unsustainable and counterproductive in the long run.”

The chairman added that these changes are part of a broader initiative to overhaul Nigeria’s tax system, which is currently characterized by multiple taxes, inefficiencies, and a narrow tax base.

Tax experts have welcomed the move, noting that the reliance on private consultants has often led to revenue leakages and inflated costs. Dr. Andrew Eke, a financial analyst, described the decision as a step in the right direction.

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“By eliminating private consultants, the government can save millions of naira annually and ensure greater accountability. It also sends a strong message about the seriousness of the reforms,” Eke said.

Similarly, Professor Aisha Bello, an economist at the University of Lagos, stressed the importance of adopting technology. “Digital systems reduce human interference and corruption. Many countries have achieved significant revenue growth through automation, and Nigeria must follow suit,” she noted.

Despite its promise, the shift comes with challenges. Experts warn that implementing a fully automated system requires significant investment in infrastructure, training, and public awareness.

“The government must ensure that the agencies tasked with these responsibilities are well-equipped and staffed with competent professionals. Otherwise, the inefficiencies may persist,” said Segun Ajayi-Kadri, a tax consultant.

The reforms are expected to improve Nigeria’s tax-to-GDP ratio, which remains one of the lowest in Africa at about 6%. By eliminating intermediaries, the government aims to reduce revenue losses and encourage compliance among taxpayers.

Additionally, the move is expected to build public trust in the tax system, as many Nigerians have expressed dissatisfaction with the opacity of revenue collection processes managed by private firms.

Oyedele assured that the committee is working closely with stakeholders to ensure a smooth transition. “We are engaging state governments, tax administrators, and the private sector to create a system that is fair, transparent, and efficient,” he said.

The reforms are part of President Bola Ahmed Tinubu’s broader economic strategy to diversify revenue sources and reduce Nigeria’s reliance on oil. If successful, experts believe this could mark a significant turning point in Nigeria’s fiscal governance.