The Centre for Social Justice has declared that the N34 trillion in customs duties waivers granted to unidentified beneficiaries in 2025 failed to follow the procedure set out in the Fiscal Responsibility Act, arguing Nigeria’s entire tax expenditure regime has been mismanaged and abused for years.
In a statement from Lead Director Eze Onyekpere, the civil society organisation recalled that the Nigeria Customs Service, appearing before the House of Representatives Committee on Finance, disclosed it had implemented N34 trillion worth of duty waivers in the 2025 financial year, telling lawmakers it does not approve waivers itself but merely implements them on the authority of the Minister of Finance. The House committee requested a full breakdown of beneficiaries, the legal basis and the purpose of the waivers, CSJ noted, stressing that customs duty waivers are only one subset of tax expenditure, which also includes tax holidays and exemptions granted to companies to attract investment, meaning a proper accounting of the government’s overall 2025 tax expenditure would likely exceed the customs figure significantly. The group pointed out that consolidated federal government revenue for 2025 was N28.23 trillion against a N36.35 trillion target, a figure that, set against N34 trillion in forgone customs revenue alone, raises fundamental questions about sound fiscal governance.
On a scale of preference, economic wisdom, common sense and rationality, CSJ asked, is it more reasonable to retain revenue duly accruing to the federal government or to plunge Nigeria into a debt trap, do we forfeit and waive revenue that rightfully belongs to us and go cap in hand to creditors. The group cited Section 29(1) of the Fiscal Responsibility Act, which requires any proposed tax expenditure to be accompanied by an evaluation of its budgetary and financial implications for the year it takes effect and the following three years, and stipulates that the Minister may only approve it if it does not adversely impair the annual budget’s revenue estimates, or if it comes with countervailing revenue raising measures. Noting that the N34 trillion waiver appears not to have followed that procedure, CSJ asked pointedly where the required evaluation is, whether it was sent to the National Assembly for approval, and where the documentation of countervailing measures the Minister was required to prepare and have approved actually is, arguing the waivers plainly did impair revenue. The group also cited the Nigerian Tax Policy 2017, which requires revenue forgone from tax incentives to be quantified against expected benefits and reported annually, asking where the annual reports quantifying years of waivers against actual, not merely expected, benefits could be found.
In light of the foregoing, CSJ and reasonable Nigerians are convinced that the tax expenditure regime has been mismanaged and abused, the statement said, any law conferring a huge discretion on any public officer to waive humongous revenues while deficits are rising and Nigeria continues the endless borrowing jamboree is not a reasonable law in a democratic society. The organisation urged the National Assembly to amend relevant laws to cap total tax expenditure at no more than 10 percent of the previous financial year’s actual revenue, and to require that proposed tax expenditures be laid before the National Assembly as a schedule to the Appropriation Bill for approval alongside the budget, alongside calling for stronger legislative oversight to enforce existing provisions of the Fiscal Responsibility Act.
