Nigerians paid N40bn as road taxes to states – FG

The Federal Government, through its National Bureau of Statistics, has stated that in 2023, Nigerians paid N40.14bn in road taxes to state governments.

This is according to an analysis of data from the Internally Generated Revenue report recently published by the NBS.

The figure collected was a 63.36 per cent increase from the N24.57bn collected in 2022.

This growth affirmed the crucial role of road taxes in state-level finances across the country.
Lagos State, widely regarded as Nigeria’s economic powerhouse, led all states with a record of N16.74bn in road tax revenue for 2023.

Despite having no record of road tax revenue in 2022, the state accounted for 41.7 per cent of the total road tax revenue in 2023.

Ebonyi State showed an exceptional increase of 3,804.32 per cent, from N72.95m in 2022 to N2.85bn in 2023.
Other states also reported substantial increases. Rivers State recorded a 270.66 per cent rise, collecting N830.01m compared to N223.93m in 2022.

Sokoto State’s collections grew by 41.22 per cent, reaching N194.66m, while Yobe State saw a 30.4 per cent increase to N81.88m, despite its relatively modest overall figure.

In contrast, several states experienced declines in road tax collections. Enugu State reported a 95.12 per cent drop, from N1.1bn in 2022 to N53.47m in 2023.
Katsina State saw a steep decline of 79.34 per cent, collecting only N29.3m compared to N141.81m the previous year.

Niger State also faced a significant reduction, with revenue falling 53.41 per cent to N190.49m from N408.83m in 2022.

Among other notable declines, Cross River recorded a 62.54 per cent drop, with collections plummeting from N3.26bn in 2022 to N1.22bn in 2023.

The Federal Capital Territory recorded no road tax revenue in 2023, a notable absence given its administrative significance.
The NBS further highlighted an overall increase in internally generated revenue across Nigerian states, with total IGR reaching N2.43tn in 2023, up by 26 per cent from N1.93tn in 2022.

Earlier in September this year, the chairman of the presidential committee on fiscal policy, Taiwo Oyedele, revealed that the committee proposed to the federal government the removal of taxes on food, public transportation, house rents, and other basic necessities critical to the well-being of Nigerians.

Oyedele said, “What we have taken into account is what are those basic necessities of life—food, accommodations, transportation, education and health. We’ve deliberately identified those items. And we’ve removed almost all the taxes applicable to them, including no VAT.

“We think that from the fiscal policy and tax perspective, we can make it more affordable for the Nigerian people to be able to afford those basic necessities. Share-passenger transportation is completely tax-free.

“However, if you hire a taxi, we assume that you’re not the poorest Nigerian so you have to pay the tax. Whereas if you get into a bus, that will be completely tax-free. That’s what we’ve done so far.”