Tax reforms: Lagos can generate N5 trillion annually, says Taiwo Oyedele

Taiwo Oyedele, the chairman of the Presidential Fiscal Policy and Tax Reforms Committee, has outlined bold strategies to bridge Lagos’ revenue gap, emphasising that the state can generate up to ₦5 trillion annually with innovative taxation reforms.

Speaking at the launch of the Lagos Economic Development Update (LEDU) on Wednesday, Oyedele described the report as “a roadmap for the future of Lagos—a future of shared prosperity, inclusive growth, and sustainable development.”

Despite being Africa’s economic powerhouse, he noted that Lagos is not generating enough revenue to match its ambitions, collecting less than 2% of its GDP annually.

Read also: Lagos unveils 2025 Economic Development Update, focuses on resilient growth

According to him, “Lagos is big, but its revenue is small… While some progress has been made, we still have a big room for improvement, and the time to change this narrative is now.”

He highlighted property taxation as one of the most underutilised revenue streams in Lagos. Comparing the city to Bogotá in Colombia, which generates over $1 billion annually from property tax, Oyedele pointed out that Lagos, despite having one of the most valuable real estate markets in the world, collects far less.

He attributed this to inefficiencies in land titling, property valuation, and enforcement. He estimated that if these issues were properly addressed, Lagos could generate at least N1 trillion annually from property tax alone, which could be reinvested in infrastructure, roads, schools, and sanitation.

He also suggested that simplifying land transactions, providing incentives for timely tax payments, and making property valuation data more accessible would significantly improve compliance.

Another major area of revenue leakage, Oyedele noted, is personal income tax, particularly among high earners and the informal sector. He pointed out that Lagos is home to Nigeria’s wealthiest individuals, largest workforce, and most vibrant informal economy, yet the tax system does not fully capture this reality.

He called for the use of AI-driven tax intelligence to identify high-income earners who should be contributing more to the system.

He also stressed the need to bring digital entrepreneurs, event planners, content creators, and entertainers into the tax net, noting that Lagos is a global hub for creativity and culture, from “Owambe” parties to “Detty December” events, yet these industries remain largely untaxed. To ensure fairness, he proposed a presumptive tax regime that would allow small businesses to contribute without being overburdened.

Beyond increasing tax revenue, Oyedele stressed the importance of tax harmonisation, arguing that Lagos’ fragmented tax system discourages compliance and breeds inefficiencies.

He urged the government to simplify and integrate tax administration, ensuring that businesses and individuals clearly understand their obligations. A predictable tax system, he said, would encourage compliance and reduce resistance.

Oyedele emphasised that Lagos has the economic potential to compete with global cities like Dubai, Singapore, and Taiwan, which have transformed their economies through progressive reforms, economic efficiency, and transparency.

According to him, “Lagos has a highly concentrated population of wealthy and middle-class individuals, a cosmopolitan hub of innovation, and a diverse economy with immense untapped potential.”

He argued that with the right policies, Lagos could become “the Dubai of Africa, the Singapore of the Atlantic, and the Taiwan of innovation and industry.”