By Huldah Shado
The Federal Government has scrapped all revenue collection deductions by agencies such as the Federal Inland Revenue Service (FIRS), Nigerian Customs Service (NCS), and Nigerian Upstream Petroleum Regulatory Commission (NUPRC), to improve fiscal transparency and accountability.
Finance Minister Wale Edun announced the reform on Wednesday in Abuja during the launch of the World Bank’s Nigeria Development Update report, themed “From Policy to People: Bringing the Reform Gains Home.”
Edun said the directive, issued by President Bola Tinubu, aims to ensure that all revenues flow directly into the Federation Account for equitable distribution to the federal, state, and local governments through FAAC.
According to him, the move eliminates “multiple and opaque deductions” that previously reduced the distributable pool. “Funds are now being remitted fully to the Federation Account as provided by the Constitution,” he said.
He added that the measure would strengthen fiscal governance, improve transparency, and ensure predictable revenue for development projects across the country.
Under the old arrangement, agencies retained a percentage of generated revenues as “cost of collection,” a practice critics said inflated expenses and weakened accountability.
The World Bank’s Lead Economist for Nigeria, Samer Matta, noted that while revenue collection has grown in 2025, excessive deductions had previously limited real gains.
The Bank’s latest report shows Nigeria’s economy grew by 3.9% in the first half of 2025, driven by stronger performances in services, non-oil sectors, and agriculture.