Citing expected improvements in revenue particularly from non-oil sources, as well as anticipated gains from the Federal Government’s fiscal and tax reforms, report has predicted that Nigeria will begin to gradually shrink its fiscal deficit going forward.
The report revealed the prediction while commenting on the Q4 2024 Budget Implementation Report (BIR) recently released by the Budget Office of the Federation (BoF).
According to the analysts, the BIR showed that the fiscal operations of the FG resulted in a fiscal deficit of N7.2 trillion in Q4 2024, an amount, which, cumulatively translates to a deficit of N13.5 trillion for FY 2024, “implying a fiscal deficit of 3.7 per cent (vs. 3.4 per cent in FY 2023), which is above the three per cent threshold stipulated in the Fiscal Responsibility Act.”
New Telegraph had reported the Chairman of the Federal Inland Revenue Service (FIRS), Mr Zacch Adedeji, revealing that federal revenue reached N3.64 trillion in September 2025, a 411 per cent increase from N711 billion recorded in May 2023. He attributed the record revenue growth to bold fiscal reforms introduced by President Bola Tinubu’s administration.
He noted that non-oil revenue grew sharply from N151 billion to N1.06 trillion in two years, marking a major shift in Nigeria’s earnings profile.
According to Mr. Adedeji, oil revenue also rose to N644 billion, while VAT collections tripled to N723 billion, signalling stronger compliance and improved efficiency across sectors.
The FIRS boss, who disclosed that a presumptive tax regime will soon capture hard-to-tax sectors, revealed that state levies will be harmonised to expand the tax base.
He also announced that Personal and Company Income Tax reforms will begin in January 2026 to further widen Nigeria’s revenue base. He reiterated that the reforms aim to cut borrowing reliance, strengthen fiscal resilience, and sustain Nigeria’s economic growth trajectory.
“Our goal is to build a fair, efficient, and sustainable tax system that supports growth and boosts investor confidence,” Mr Adedeji stressed.
The FBNQuest report also revealed that while the FG’s retained revenue for FY 2024 totalled N21.0 trillion, up 68 per cent Year-on-Year (YoY), it was still N4.9 trillion below the budget benchmark of N25.9 trillion.
Similarly, they pointed out that while oil revenue grew 168 per cent YoY to N6.3 trillion, “due to a weaker naira and higher oil production YoY,” it still “underperformed the 2024 budget target of N8.2 trillion.”
Further commenting on the report, the analysts stated: “The FG’s share of non-oil revenue increased by 51% YoY to N5.0 trillion and was 40 per cent ahead of the budget target of N3.6 trillion.
