Government Unveils Bold Measures to Tax Foreign Residents and Boost National Revenue

The Federal Executive Council (FEC) is taking decisive steps to tighten the reins on Nigeria’s economy and border security, proposing critical amendments that could significantly impact foreign residents. Among the legislative changes is a proposal to amend the National Identity Management Commission Act of 2007, allowing the issuance of National Identification Numbers (NIN) to foreigners residing in the country.

In a move aimed at widening the tax net, the FEC has also introduced the Economy Stabilisation Bill. This bill seeks to ensure that expatriates and income-earning foreign nationals in Nigeria are subject to taxation, marking a turning point in the country’s efforts to tap into overlooked revenue streams.

The proposed amendments aim to “expand the scope of registrable persons to include foreign individuals with a taxable presence or taxable source of income in Nigeria” and make it mandatory for NINs to be used in all transactions tied to tax administration. This development underscores the government’s push to formalise the contributions of foreign residents to the economy, ensuring no income source goes unregistered or untaxed.

A key addition to Section 16 of the NIMC Act reads: “Any person, whether or not they are a citizen of Nigeria, who is deemed to be resident or otherwise subject to tax in Nigeria under any legislation in force in Nigeria.” Should these amendments become law, expatriates and working immigrants will now be required to contribute to the national tax coffers.

Addressing journalists in Abuja, Special Adviser to the President on Information and Strategy, Bayo Onanuga, emphasised the significance of these changes. “If the National Assembly passes this bill, it mandates that everyone living and earning an income in Nigeria, including foreigners, will be registered and issued a NIN. This is a key step to ensuring that every resident under the tax structure is accounted for,” he said.

Onanuga further explained that the NIN would function as a unique tax identifier, helping to streamline tax administration and integrate foreign residents into the nation’s fiscal framework. “This legislation seeks to close a gap in the system. Previously, foreigners were excluded from registering for NINs, but that’s about to change.”

In addition to tax reforms, the government has also proposed amendments to the Nigerian Maritime Administration and Safety Agency Act of 2007. This move aims to improve the ease of doing business by mandating that all fees and charges paid to the agency be transacted in Naira, rather than US dollars. “The government is keen on reducing the dollarisation of the Nigerian economy. We want to strengthen the Naira by ensuring that fees, levies, and fines are paid in our local currency,” Onanuga added.

This suite of legislative changes marks a bold step in Nigeria’s efforts to safeguard its borders, stabilise its economy, and affirm its sovereignty in financial and regulatory affairs. By bringing foreigners into the tax fold and reinforcing the use of the Naira, the government hopes to bolster revenue streams and strengthen the nation’s economic resilience.