The International Monetary Fund (IMF) has called on the Federal Government of Nigeria to broaden its tax base and tackle tax evasion, as part of a broader push for fiscal reforms aimed at fortifying the country’s economic stability.
Speaking during a press briefing at the 2025 IMF Spring Meetings in Washington, D.C., IMF Managing Director Kristalina Georgieva stressed the importance of domestic revenue mobilization and the adoption of digital solutions to modernize tax administration and reduce leakages in public finance systems.
Need to Move Beyond Oil Revenue
Georgieva highlighted the growing vulnerability of oil-exporting countries like Nigeria due to falling global oil prices. She emphasized the urgency of diversifying revenue sources beyond oil to build long-term resilience.
“Countries like Nigeria must widen their tax base. This isn’t just about plugging budget gaps today—it’s essential for long-term economic sustainability,” she said.
Technology as a Revenue Tool
She encouraged governments across Africa to deploy digital tools to enhance tax collection, improve compliance, and close loopholes. “Technology, when used strategically, can increase efficiency, reduce tax evasion, and ensure a more equitable system,” Georgieva noted.
Tailored Monetary Policies for Africa
On monetary policy, Georgieva advised African central banks to focus on strategies that reflect their own economic realities, rather than replicating models from other regions.
“We’re past the era of simply copying another central bank’s playbook. Policymakers must consider local inflationary trends, resource availability, and design solutions tailored to their economy,” she said.
Emphasis on Transparency and Good Governance
Georgieva also emphasized the need for transparency, anti-corruption efforts, and strong governance across Africa, stating that sound fiscal and monetary policy must work in tandem to drive sustainable growth.
Push for Stronger Regional Trade
On trade, she urged African nations to enhance intra-regional commerce and remove barriers limiting economic integration. Drawing parallels with the ASEAN model, she said African countries should work together to improve supply chains and shared infrastructure.
“Infrastructure gaps often block progress. Institutions like the World Bank are working to eliminate these roadblocks. If Africa can overcome them, it can unlock vast economic potential,” she added.
She pointed to Africa’s youthful population and natural resource wealth as key assets. “With the right mix of policy and innovation, Africa has the potential to shape the future of global growth,” Georgieva said.
Building Economic Buffers
Countries such as Nigeria, Egypt, Ghana, and Côte d’Ivoire were advised to continue building economic buffers and creating fiscal space to withstand external shocks from global downturns or commodity price swings.
“A more connected and collaborative Africa can become a global economic force,” she concluded.
Global Tariffs a Potential Threat
Georgieva also warned that while global tariffs may not hit African economies immediately, their ripple effects could still disrupt growth on the continent in the long term.
FG Plans VAT Exemption for Real Estate
In a related development, Nairametrics reported that the Federal Government plans to exempt real estate transactions from Value Added Tax (VAT) under the proposed Tax Reform Bill. The move is aimed at reducing construction costs and stimulating growth in the real estate sector.
This exemption is expected to lessen the financial burden on low-income earners and promote investment in housing and infrastructure development.