New Tax Act Will Curb Oil Revenue Leakages — Expert
Abuja, Nigeria — A tax expert has said Nigeria’s newly enacted Tax Act will significantly curb revenue leakages in the oil and gas sector by streamlining fiscal frameworks, strengthening transparency, and tightening oversight across the industry.
Speaking on the reforms, the expert explained that the new law harmonises previously fragmented tax provisions governing upstream, midstream and downstream petroleum operations, closing loopholes that had allowed revenue losses through under-reporting, weak enforcement and regulatory overlaps.
According to the expert, the Act introduces clearer tax obligations, improves real-time reporting, and enhances coordination among revenue-collecting agencies, including the Federal Inland Revenue Service (FIRS) and other sector regulators. These measures, he said, will make it more difficult for operators to evade taxes or exploit grey areas in the fiscal system.
The oil and gas sector has historically suffered from complex and sometimes conflicting tax rules. By simplifying the framework and strengthening compliance mechanisms, the new Tax Act will reduce leakages and improve government revenue,” the expert noted.
He added that the legislation also promotes greater transparency through stricter disclosure requirements and penalties for non-compliance, while leveraging digital tools to monitor production volumes, exports and tax payments more effectively.
Industry analysts believe the reforms could help Nigeria maximise earnings from its petroleum resources at a time when the government is under pressure to boost non-debt revenue and stabilise public finances. However, they caution that the success of the Act will depend largely on effective implementation and sustained enforcement.
The Federal Government has repeatedly pledged to block revenue leakages in the oil and gas sector, which remains a major source of foreign exchange and fiscal income for the country. The new Tax Act is expected to play a central role in achieving that objective.
