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Strategies for implementing the new Nigerian Tax Reform Act 2025 in local councils have been outlined by the Senate and other significant stakeholders in Nigeria’s local government administration. These strategies aim to improve the local councils’ Internally Generated Revenue (IGR), strengthen their autonomy, and improve their fiscal responsibility.
The Act focuses on three important areas: local government autonomy, the crucial issue of IGR, and fiscal federalism. The Act, which goes into force in January 2026, mandates that local councils implement data-driven policies, update dormant revenue systems, and preserve the sacred trust of public service financial stewardship.
This was the main topic of discussion at the recently concluded Nigerian Local Government Development Summit and Award, which was held in Abuja under the theme “building Nigeria from the grassroots and unlocking the promise of the Nigerian Tax Act 2025” and was organized by the Senate Committee on States and Local Governments Administration in partnership with Global Gold Consult Ltd.
Godswill Akpabio, the president of the Senate, characterized the Nigerian Tax Act 2025 as a daring declaration that will no longer be constrained by antiquated procedures, limited revenue streams, and crippling reliance on federal allocation.
Akpabio stated, “It is a call to modernize and simplify our local governance, and a pathway to fiscal responsibility, equity, and efficiency aimed to advance autonomy for our local councils and generate revenue.”
Speaking on behalf of Senator Binos Dauda Yeroe, the Chairman of the Senate Committee on State and Local Government Administration, Akpabio emphasized that the tax code is more closely linked to the advancement of the country.
“These are actions, not goals, and we will move on with unyielding resolve. We backed measures that give our local government better means to provide services with honor and competence.
“We will strengthen intergovernmental operations, empower communities, and guide the implementation of the Tax with the Senate’s commitment to upholding the integrity that fiscal federalism demands from all levels of government,” he stated.
According to Akpabio, the recently passed tax law challenges Nigeria to consider how resources are mobilized, managed, and promoted throughout all levels of government, encouraging accountability and openness, while also marking a substantial shift in the nation’s fiscal architecture.
Journalists were informed by Engr. Kayode Adegbayo, Managing Director/CEO of Global Group Consult and consultant to the Senate Committee on State and Local Government, that the yearly summit has produced many advantages for the advancement of the Nigerian grassroots.
“All efforts must be made to ensure that local government is effectively developed because it is the most critical tier of government due to its proximity to the people,” he stated.
“The Supreme Court declared fiscal autonomy of the local government tier through President Bola Tinubu’s efforts, and that declaration is already improving the releases of funds into the local system in Nigeria, though not yet in full.”
Professor John Olatunji Alabi, a co-consultant to the organizers, said that President Tinubu’s administration is completely dedicated to using this tax reform act to reengineer IGR and investigate other revenue streams for local governments.
Additionally, Uche Uwaleke, a professor of capital markets and a member of the Presidential Committee on Fiscal Policy and Tax Reforms, told reporters, “We believe that these tax reforms, when they are implemented, will go a long way to do that. The whole essence of the tax reforms is to streamline the multiple taxes that we have today, particularly at the local government levels.”
“It’s clear that local residents are grumbling about several levies, which is limiting enterprises. Therefore, a scenario where there are no more than nine taxes at the local and state levels will be put into effect next year. People in that area will be able to breathe easier if business is made uncomplicated.
