Oxfam in Nigeria has said that wealthy Nigerians evade tax while millions go hungry. Oxfam said this at the presentation of two comprehensive studies titled ‘Income and Wealth Inequality in Nigeria: Trends and Drivers’, and ‘Taxing the Rich Fair Tax Monitor’ in Abuja. According to Oxfam, the two reports exposed the deepening inequality crisis across the country, despite being the fourth-largest economy in Africa, the benefits of economic growth have largely been concentrated in the hands of a small elite, leaving millions of Nigerians trapped in poverty. Meanwhile, the report titled Income and Wealth Inequality in Nigeria: Trends and Drivers and Taxing the Rich: Fair Tax Monitor is a comprehensive analysis conducted by Oxfam in Nigeria, the Tax Justice Network Africa, and the Civil Society Legislative Advocacy Centre (CISLAC). This study explores the structural causes of inequality in Nigeria, focusing on income, wealth, gender, and regional disparities.The findings are based on statistical data, expert analysis, and contributions from key policy stakeholders.
“Oxfam exposes a staggering wealth gap in Nigeria in two comprehensive studies and urges the adoption of progressive wealth taxation and increased social investment to bridge the growing economic and social divide before a social bomb explodes. The two comprehensive studies, Income and Wealth Inequality in Nigeria: Trends and Drivers, and Taxing the Rich Fair Tax Monitor expose the deepening inequality crisis. Despite being the fourth-largest economy in Africa, the benefits of economic growth have largely been concentrated in the hands of a small elite, leaving millions of Nigerians trapped in poverty. Only 40 of the wealthiest Nigerians were found to be compliant taxpayers, according to the Federal Inland Revenue Service (FIRS) and John Bean Technologies Corporation (JBT). This represents a compliance rate of just 0.035%, meaning that over 99% of Nigeria’s wealthiest citizens evade or avoid paying taxes. Oxfam is calling on the Nigerian government to adopt the following measures: Increase Social Spending: Nigeria currently allocates only 2-3.5% of its budget to education and 4-7% to healthcare, well below global standards. The government must raise social sector spending to at least 10% of the budget in health, education, and agriculture.
“Implement Progressive Taxation: Establish a wealth tax targeting high-net-worth individuals. A 1% tax on net worth over $1 million could raise $7.5 billion annually, which could fund critical social programmes. Invest in Human Capital Development: Improve education, job creation, and healthcare, focusing on rural and underserved populations. Providing living wages, reducing corruption, and enhancing educational opportunities, particularly for women and girls, will improve Nigeria’s Human Development Index (HDI) by 2030. Support Smallholder Farmers and Reform Agriculture: Strengthen policies that improve access to credit, land, and rural infrastructure for smallholder farmers. Prioritising women’s land rights and promoting sustainable farming practices will help bridge the rural-urban divide. Reform Land Policies: Establish a National Land Commission, conduct a National Land Audit, and ensure that land redistribution programmes are transparent and inclusive, particularly addressing gender disparities. Collaborate with Civil Society: Non-state actors, including civil society organisations, the private sector, and community groups, should advocate for pro-poor policies, hold the government accountable, and promote gender equality. Develop a comprehensive wealth registry and stronger tax enforcement will ensure high-net-worth individuals contribute fairly.”
In an address of welcome, the Executive Director, Civil Society Legislative Advocacy Centre, CISLAC, Anwual Rafsanjani, called on the government to implement a Net Wealth Tax; Raise the Capital Gains Tax to align with global best practices; Exempt basic goods from VAT while introducing luxury taxes on high-end goods like private jets, luxury cars, and yachts; Standardise property valuation and digitise land registries to improve tax collection. Rafsanjani further stated that government should fully exempt Nigerians earning below the minimum wage or less than N840,000 annually from Personal Income Tax, PIT, while raising the top tax rate to at least 40 per cent for the top one per cent; Introduce Inheritance and Gift Tax: Targeting estates exceeding N50 million, with a progressive tax rate, to ensure wealth redistribution.
Renegotiate Double Taxation Agreements (DTAs): Strengthen Nigeria’s tax sovereignty by reviewing DTAs that disproportionately benefit multinational corporations and establishing a specialised DTA unit within the FIRS.
