Why Nigerians Are Resisting Tinubu’s Tax Reforms

Trust Deficit Threatens Nigeria’s Ambitious Tax Reforms — SBM Report

BY any fiscal benchmark, Nigeria’s 2025 Tax Reform Acts were designed to mark a decisive shift away from the country’s historic dependence on oil revenues. After decades of failed attempts to build a broad, sustainable tax base, the reforms promised to strengthen government finances, stabilise public spending and reduce vulnerability to oil price shocks.

Yet as implementation gathers momentum in 2026, the reforms are encountering fierce resistance from the very public they seek to mobilise. According to a new report by SBM Intelligence (SB Morgen Intelligence), the problem is not the size of the tax burden, but a deep crisis of trust that threatens to derail one of President Bola Tinubu’s most ambitious economic initiatives.

Political Will Meets Public Pushback

The report, titled “Taxing Patience: Nigeria’s Reform Resistance… Analysing the Precarious Balance between Fiscal Reform and Public Distrust in Nigeria,” was unveiled on Thursday and paints a sobering picture of a reform agenda colliding with public scepticism.

Paradoxically, President Tinubu’s administration has shown unusual resolve in pushing ahead with the tax reforms despite widespread backlash. This determination stands in contrast to regional peers such as Ghana and Kenya, where similar measures were scaled back or abandoned after public protests.

But that political will has unfolded against a backdrop of allegations of legislative irregularities, controversy over foreign technical partnerships, and longstanding doubts about how tax revenues are used.

A Low-Tax Country with High Resistance

Nigeria’s tax-to-GDP ratio has remained stubbornly low—between six and seven per cent—for more than a decade, placing the country among the weakest tax performers in sub-Saharan Africa. By comparison, Ghana and Kenya record ratios of between 13 and 15 per cent.

Against this background, the 2025 Tax Reform Acts aim to raise non-oil tax revenue by an estimated 1 to 1.5 percentage points of GDP over the medium term. In real terms, that translates to an additional ₦3–₦5 trillion annually once fully implemented.

For a government grappling with declining oil receipts, rising debt service obligations and growing development needs, the revenue potential is macroeconomically significant. But for most individual taxpayers and businesses, analysts note, the reforms do not represent a sudden or punitive fiscal shock.

This disconnect has sharpened the central puzzle confronting policymakers: why is resistance so intense?

Trust, Not Taxes, at the Core

According to SBM Intelligence, opposition to the reforms is rooted less in the amount of tax demanded and more in perception, enforcement dynamics and a long-broken social contract between the Nigerian state and its citizens.

The report draws on a January 2026 survey of 200 respondents across nine Nigerian cities, alongside legal reviews and a comparative analysis of tax protests across Africa.

Its findings reveal a severe trust deficit. As many as 68.5 per cent of respondents said they completely distrust the government’s use of tax revenues, while only 27.5 per cent believe the reforms will benefit the country.

Although awareness of the reforms is relatively high—42.5 per cent say they know about them and another 46 per cent say they have heard something—the awareness has not translated into acceptance. In fact, SBM notes that higher awareness often correlates with stronger opposition.

A Transactional View of Citizenship

Public sentiment, the report argues, is fundamentally transactional. Nigerians’ willingness to comply with tax obligations is conditional on visible improvements in public services, particularly electricity, roads and security.

In the absence of tangible gains, taxation is widely perceived not as a civic duty but as another form of extraction by the state.

This perception is compounded by uneven enforcement. The reforms are being felt most acutely by individuals and businesses already within the formal financial system, reinforcing the belief that compliance attracts punishment rather than protection.

Regional Fault Lines Emerge

Resistance to the tax reforms is not uniform. SBM’s findings highlight sharp regional disparities that reflect Nigeria’s complex political economy.

The South West—especially Lagos—emerged as a major hotspot of opposition. As Nigeria’s commercial nerve centre, Lagos hosts a dense concentration of formal-sector workers and businesses already subject to multiple taxes.

Here, distrust is driven by concerns about dual taxation, aggressive enforcement and doubts surrounding the integrity of the legislative process.

In contrast, resistance in parts of the North East, including Bauchi, is shaped by geopolitical anxieties. Fears about sovereignty and externally influenced policies loom large, feeding suspicion toward reforms perceived as imposed without adequate local consultation.

The Informal Sector Dilemma

The informal sector presents another layer of complexity. Many informal operators already pay coercive fees to non-state actors such as local touts and community enforcers just to operate.

Rather than viewing formal taxation as a replacement for these arbitrary levies, many see the new tax regime as an additional burden. The promised benefits of formalisation—protection from extortion, access to services and legal recognition—remain distant and uncertain.

Controversies Undermining Confidence

SBM also points to controversies that critics describe as self-inflicted. Allegations that the tax laws were materially altered after passage by the National Assembly have raised questions about procedural integrity, even as the government denies wrongdoing.

Regardless of the facts, the perception of irregularity has weakened confidence and shifted the debate from economic necessity to constitutional legitimacy.

Equally contentious is the technical cooperation agreement between the Federal Inland Revenue Service and the French tax authority. While officials describe it as a capacity-building partnership, critics have labelled it “digital colonialism,” inflaming nationalist sentiment and undermining technocratic arguments.

A Narrow Path Forward

SBM Intelligence warns that the Tinubu administration is at a critical juncture. A one-size-fits-all national implementation strategy is unlikely to succeed.

Instead, the report recommends regionally differentiated tax administration, tailored communication strategies and visible links between tax collection and service delivery.

Even modest but tangible improvements in electricity supply, road security or urban infrastructure—clearly tied to tax revenues—could reshape compliance incentives.

Ultimately, the report concludes, Nigeria’s tax challenge is as political as it is fiscal. The architecture of reform may be in place, but its success will depend on legitimacy, trust and execution.

As 2026 unfolds, citizens will judge the reforms not by policy documents, but by whether the state can finally demonstrate that taxation delivers value.