Written By Dr. Oluwaseun Adeoye Oyebamiji
Picture a composite Nigerian trader, ordinary in every respect, selling provisions in a large Lagos market. Before the morning rush ends she has settled with several people: one issuing a council ticket, one collecting for the traders’ association, one for the union that controls the loading bay, and one carrying no paper at all. She receives a receipt for some of it. The rest disappears into the day. All of it is unremarkable to anyone who knows Nigerian markets, which is the problem.
What she experiences is usually filed under taxation. Some of it is not. Taxation is what a state does openly, by published rule, with a receipt and a right of appeal. Payments taken without authority, without documentation and with an implicit threat are something else. The Nigerian state is not simply too large. It is present as collectors nobody can name, and absent as an authority able to say which payments she owes.
The Central Bank’s own surveys show the pattern. In the Business Expectations Survey for May 2026, insecurity led business constraints at 72.9 points, with high and multiple taxes behind it at 70.3 and high interest rates at 67.7. Firms place the number of claimants near the top of their own list.
The scale cannot honestly be given as a fixed number. Nigerian businesses face a proliferation of taxes, levies, fees and charges across three tiers of government and numerous agencies, with no authoritative inventory. The Manufacturers Association has cited more than sixty separate taxes and levies affecting its members. Taiwo Oyedele, who chairs the fiscal reform committee, has said the unofficial count runs past two hundred. These are informed claims, not audited totals, and the argument does not need exactness. A country where nobody can say how many charges a business faces has already made the case.
The count means something specific out on the road. A relative of mine recently branded a minibus to distribute oils to wholesalers and retailers on demand. The bus carries his name, which is the purpose of branding and, it turns out, the price of it. Three times it has been stopped and made to pay: by the Vehicle Inspection Office, an environmental sanitation office, a local government revenue authority and police at a checkpoint. Every registration it carries was issued in Nasarawa. It has still paid in Kwara, where a separate environmental sanitation authority claimed it, and again in Osun. He did the formal thing: registered, branded, easy to find. The reward is a vehicle any collector can read from fifty metres.
On Ayittey’s reading of indigenous African economies, this was not the inherited pattern. He described village markets where prices came from bargaining and traders moved along established routes without central permission, and argued that authority’s traditional role was keeping the peace so commerce could happen. What arrived after independence, in his account, was an apparatus whose main relationship with trade was the licence and the levy. That is interpretation rather than settled history. The levy collector is not tradition. He is a modern arrangement.
Informality should not be admired for surviving this. The trader has no title to her stall, no bank credit at a workable rate, no protection if her goods are seized and no path to employing fifty people. It is a rational response to costly institutions, not a preference. It buys survival and forecloses growth. The minibus shows why it persists: an unmarked vehicle attracts fewer claimants than a branded one.
The counterargument deserves a hearing. Nigeria’s revenue base is thin, and a state that cannot pay for courts and roads is no friend of enterprise. Broadening the base is legitimate. But neither problem here is the rate. It is the number of claimants and the missing documentation. An obligation they could see, however unwelcome, is one they could plan around.
The 2025 legislation offers a test. The Nigeria Tax Administration Act allocates jurisdiction among tax authorities under Section 3 and its First Schedule, and gives collectors statutory form: a State Internal Revenue Service under Section 87, a Local Government Revenue Committee under Section 93, and a State Joint Revenue Committee under Section 95, charged with harmonising administration within the state.
Within the state is the phrase to watch. A bus registered in Nasarawa and stopped in Kwara and Osun falls outside any single state’s harmonising body. Oyedele has put the principle more bluntly than the statute: a levy not on the approved schedule should not be paid, and officials acting outside the law are acting illegally. That is policy, not quoted statutory text.
Whether the gap closes is answerable at any market gate or checkpoint, by posting the approved schedule where traders and drivers can read it.
Nigeria does not have a shortage of taxpayers. It has a shortage of receipts.
Dr. Oluwaseun Adeoye Oyebamiji is a development economist and agricultural policy researcher whose work examines food security, poverty, markets, agricultural policy and economic development, particularly in Africa. His research combines empirical evidence with policy analysis to examine contemporary economic and development issues.
Sources
Nigeria Tax Administration Act 2025: Section 3 and First Schedule (allocation of jurisdiction among tax authorities); Section 87 (State Internal Revenue Service); Section 93 (Local Government Revenue Committee); Section 95 (State Joint Revenue Committee, charged with harmonising tax administration within the state).
Central Bank of Nigeria, Business Expectations Survey, May 2026: insecurity 72.9, high and multiple taxes 70.3, high interest rates 67.7, unfavourable political climate 64.2, high bank charges 64.1.
Manufacturers Association of Nigeria: count of more than sixty taxes and levies borne by members. Industry estimate, not an audited total.
Taiwo Oyedele, Presidential Committee on Fiscal Policy and Tax Reforms: on an unofficial count exceeding two hundred, and on unlisted levies not being payable. Statements of policy by an official, not quoted statutory text.
First-hand account of a family-owned distribution business operating a branded minibus registered in Nasarawa State, reported to the author. Bodies named by the operator: the Vehicle Inspection Office, an environmental sanitation office, a local government revenue authority, police at a checkpoint, and a separate environmental sanitation authority in Kwara. Single-case testimony, offered as illustration rather than evidence of frequency.
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