Nigeria and regional partners to benefit from new initiative aimed at improving revenue collection, digital tax systems, and governance in the extractive sector…..
The African Development Bank Group has approved a $5.52 million grant to support efforts aimed at strengthening tax administration and improving domestic revenue mobilization in Nigeria and several other West African countries.
The funding agreement, announced over the weekend, was signed between the bank and the West African Tax Administration Forum (WATAF), marking the launch of a regional initiative designed to modernize tax systems and enhance fiscal governance across the subregion.
According to the development finance institution, the program will help participating countries improve revenue collection capacity, reduce leakages, and build stronger governance frameworks capable of supporting long-term economic development.
Strengthening revenue systems across West Africa
Officials at the AfDB noted that improving tax administration remains a critical priority for many West African countries seeking to increase internally generated revenue and reduce reliance on external borrowing.
Speaking on the initiative, Abdul B. Kamara, Director General of the AfDB for Nigeria, emphasized the importance of efficient tax systems in strengthening public finances.
“Strengthening tax administration is essential for creating the fiscal space needed to support economic development across West Africa,” Kamara said.
He added that the project will support governments in enhancing revenue collection efficiency, closing financial leakages, and strengthening governance structures related to both domestic taxation and revenues from natural resources.
For the regional tax body, the initiative represents a significant step forward. Jules Tapsoba, Executive Secretary of WATAF, described the project as a milestone for the region, noting that it is the first region-wide tax administration program financed by the AfDB Group.
Details of the tax administration project
The funding will support the Strengthening Tax Administration Capacity Project in West Africa (STACP-WA), an initiative focused on improving governments’ ability to mobilize, manage, and safeguard domestic revenues.
The project will be financed through the African Development Fund under its Transition Support Facility.
Six countries are expected to directly benefit from the initiative:
- Burkina Faso
- Guinea
- Guinea-Bissau
- The Gambia
- Liberia
- Sierra Leone
Although Nigeria is not listed among the direct recipients, its tax authorities are expected to play a technical role in the program’s implementation and knowledge sharing.
The initiative will provide governments with technical support to modernize tax and customs administration while also strengthening oversight of revenues from natural resources such as oil, gas, and mining.
Digital technology will play a key role in the project. Authorities plan to deploy new tools aimed at improving transparency in revenue collection and reducing illicit financial flows across the region.
The project is scheduled to run until July 30, 2030.
Oversight will be provided by a steering committee made up of representatives from WATAF, the Economic Community of West African States, and participating countries.
Meanwhile, a dedicated implementation unit within WATAF will manage day-to-day operations and coordinate activities across member states.
Nigeria’s tax reforms align with the initiative
The development comes at a time when Nigeria is undertaking major tax reforms under President Bola Ahmed Tinubu.
The president recently signed four major tax reform laws designed to restructure the country’s revenue administration framework. These include the Nigeria Tax Act 2025, the Nigeria Tax Administration Act 2025, the Joint Revenue Board of Nigeria (Establishment) Act 2025, and the Nigeria Revenue Service (Establishment) Act 2025.
The reforms officially took effect on January 1, 2026, and are expected to overhaul Nigeria’s tax system, boost government revenues, and improve the overall business environment.
Under the AfDB-supported initiative, Nigeria’s tax authorities will collaborate with WATAF and the regional bloc to provide technical expertise and share policy insights with other participating countries.
Key components of the project include the development of an electronic invoicing toolkit, improved transfer-pricing assessment tools for the extractive sector, and specialized training programs aligned with the African Continental Free Trade Area framework.
Additional support will focus on improving Value Added Tax administration, customs valuation processes, governance in the mining sector, and the design of gender-responsive tax policies.
According to the AfDB, strengthening tax systems across West Africa is a crucial step toward improving fiscal resilience and enabling governments to finance development priorities without excessive reliance on debt.
