By Dare Adekanmbi
LONG before Nigeria claimed its independence in 1960, agriculture was the heartbeat of its economy.
The stories of the First Republic highlight how various regions flourished— from the North’s bustling groundnut pyramids to the fertile cocoa farms in the West, and the East’s thriving rubber and palm oil production.
Each region carved its niche, proudly contributing to a rich and diverse economic landscape. However, the tide turned dramatically with the discovery of crude oil in commercial quantities, starting in Oloibiri, Bayelsa State, in 1956.
Over time, this “black gold” eclipsed agriculture, transforming the nation’s revenue stream as the Nigerian National Petroleum Corporation (NNPC) took center stage, essentially becoming the financial lifeblood for all levels of government.
Those days, when federal, state, and local authorities eagerly awaited revenue figures from the NNPC, are now a distant memory.
The narrative has shifted! Today, the spotlight shines brightly on the Federal Inland Revenue Service (FIRS)—the new powerhouse fueling Nigeria’s fiscal sustainability. So, what’s cooking at the Federation Account Allocation Committee (FAAC)?
The “cake” shared among the tiers of government is now baked primarily by four heavyweights: NNPC, FIRS, the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), and the Nigeria Customs Service (NCS).
Yet, under the leadership of Zacch Adedeji, FIRS has emerged as the star performer, contributing nearly 70% of total revenues for the three tiers of government at FAAC meetings in 2024.
Consider this: In January alone, out of a staggering N2.068 trillion that filled the Federation Accounts, FIRS accounted for over half of that sum—an impressive N1.275 trillion.
Meanwhile, the NNPC, NUPRC, and NCS collectively brought in only a fraction of the total. Excitingly, FIRS’s performance only grew stronger in February, reaching N1.491 trillion from an N2.3 trillion haul, overshadowing its counterparts. As the months rolled on, these contributions remained remarkable.
FIRS reported N1.061 trillion in March, N1.187 trillion in April, and a record N1.571 trillion in May. The momentum continued with an astounding N2.841 trillion in June, amidst a total of N3.5 trillion shared.
Yet, under the leadership of Zacch Adedeji, FIRS has emerged as the star performer, contributing nearly 70% of total revenues for the three tiers of government at FAAC meetings in 2024.
Even in the subsequent months, FIRS held its ground: N2.295 trillion in July, N1.87 trillion in August, and impressive figures continuing into the fall. The significance of FIRS’s ascent—effectively transforming tax revenue into Nigeria’s new “crude oil”—has not gone unnoticed.
Dr. Oluwatoyin Madehin, the outgoing Accountant General of the Federation, emphasized this shift at a recent event in Abuja, declaring, “Tax revenue is now the highest source of income for the Federation. We eagerly await the FIRS numbers at FAAC meetings, as each report brings reassurance and joy to all tiers of government.”
This remarkable turnaround underscores how FIRS’s contributions have enabled the three tiers of government to plan and project with newfound confidence.
In the world of fiscal discipline, accurate revenue predictions are essential. After all, if you aim to spend N10, you must have a reliable source for that amount.
As FIRS continues to redefine Nigeria’s economic landscape, one thing is clear: tax revenue has truly become the nation’s new lifeblood, fostering growth and stability for years to come.
▪︎ Adekanmbi is the Special Adviser on Media to the Executive Chairman of the Federal Inland Revenue Service (FIRS).