From Juliana Taiwo-Obalonye, Abuja
Chairman, Federal Inland Revenue Service (FIRS), Zacch Adedeji, has said even though the Federal Government has seen a remarkable surge in revenue collection, growing by 411 per cent over 16 months to N3.64 trillion as of September 2025, borrowing still remains an essential tool, but now focused strictly on funding growth and infrastructure, rather than recurrent expenses.
He revealed the strong revenue performance yesterday, during the press briefing organised by the presidential media team, at the State House, Abuja.
He disclosed that revenues soared from N711 billion in May 2023 to N3.64 trillion in September 2025. Non-oil tax collections experienced the sharpest rise, increasing from N151 billion to over N1 trillion during that period. Oil revenue also climbed considerably, with receipts rising from N96 billion to N644 billion.
Value Added Tax (VAT) receipts more than tripled to N723 billion from N218 billion, while customs revenue surged to N322 billion from N106 billion.
He noted that the Nigerian Upstream Petroleum Regulatory Commission also reported remittances jumping to N745 billion from N125 billion, while the Nigerian National Petroleum Company Limited contributed N111 billion in September 2025.
He attributed the revenue boom to tax reforms initiated under President Bola Tinubu’s administration. Measures such as streamlining tax systems, reducing burdens on SMEs, harmonising levies and deploying new technology platforms, like e-invoicing and data-driven audits, have closed tax leakages and expanded the tax base.
Responding to a question on why Nigeria continues to borrow, despite hitting lofty revenue targets, he said the strategy had shifted dramatically. He stressed that borrowing was no longer to cover salaries or subsidies but was directed at financing infrastructure and productive investments to spur long-term economic growth.
“Borrowing is not a problem, banks are part of our economic ecosystem. There is no country or an individual in the world that survives based on its own income. When the government borrows from the bank, we pay interest. It is from that interest they get their salary. It is from the salary that they pay taxes to the state government. It is from the difference between profit and lending that I collect taxes. So when you say you go for lending, it means you go for sustainability,” he explained.
“So, you borrow to beat higher costs for the future, you borrow because of a matching concept to sustain continuity when you borrow to do road infrastructure and you collect taxes from anybody using that road to pay their fair share.
“Borrowing is part of the economic plan and any country that will grow has to borrow because it is part of the ecosystem of a viable nation.
“So, when Mr. President said we have met our target or we are doing well in revenue, and they say why are we borrowing, is borrowing not part of the budget we submitted to the National Assembly? Are we borrowing outside what is approved?”
President Tinubu, who has consistently pushed for fiscal discipline, declared in his 2025 mid-year economic briefing that domestic resource mobilisation was paramount. “Our goal is to fund development from internally generated revenues and borrow only to support investments that can pay for themselves.
“If I have revenue of 80 and I borrow 20 as planned, then I have met my expenditure target of 100. So, borrowing within the approved budgetary limits is normal and necessary to meet the fiscal needs. The problem arises when borrowing is excessive or unplanned, causing debt distress or macroeconomic instability.
“Also, borrowing is not wrong as long as it is sustainable and used for productive sectors that generate economic growth, which in turn enhances revenue generation to repay the loans.
“Therefore, the approach of stopping printing money, ending monetisation of deficits, helps in controlling inflation and exchange rate pressures. It shows fiscal discipline by relying on actual revenue collection and planned borrowing. This deliberate effort supports macroeconomic stability and fosters investors’ confidence in the economy.
“In summary, borrowing as a component of the budget is legitimate, provided it aligns with fiscal plans, is transparently managed and repayment commitments are respected.”
He said the government was also actively settling inherited debts to stabilise Nigeria’s fiscal position, including obligations related to the Central Bank’s overdraft facilities, strengthening investors’ confidence in the country’s finances.
On future projects, he said FIRS plans further reforms aimed at enhancing fiscal efficiency and competitiveness. These include harmonising subnational levies to reduce multiple taxation, introducing a presumptive tax system for informal sectors and progressively lowering corporate tax rates to attract investment.
Additionally, he said constitutional reforms were being pursued to clarify revenue allocation between federal and state governments under strengthened fiscal federalism.
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