External and INTERNAL Revenue Generation

Nigeria is facing a severe financial crisis, with our expenditures far surpassing our revenue generation. Acknowledging that we have issues with both spending and revenue, we plan to substantially reduce government expenditures. However, cutting costs alone won’t suffice to fund the crucial strategic initiatives outlined in this Covenant. Therefore, generating substantial new revenue is imperative.

We have identified several preliminary sources for this new revenue. While some of these strategic initiatives can be implemented through executive orders, others will require legislation by the National Assembly. A majority, though, can be achieved via executive actions. I am fully committed to working in tandem with the National Assembly to efficiently fulfill the people’s mandate.

From the onset of my leadership, we will concentrate on significantly boosting revenue by implementing these vital policy actions, ensuring a more financially stable and prosperous Nigeria:

Combat Oil and Petroleum Product Theft: My administration is committed to deploying the full strength of the federal government, including advanced technology and extensive surveillance, to tackle the issue of oil theft, which is a crime against the Nigerian people. As stated previously, we will enforce the death penalty, ensuring that anyone found guilty of oil theft will be subject to the most severe penalty under the law, without any exceptions.

Increase Oil Production: My goal is to boost oil production from the current level of 1.3 million barrels per day (mbpd) to meet the OPEC+ quota of 1.7 million mbpd. Upon achieving this target, my administration will engage in negotiations with OPEC+ to further increase our production quota to 2.5 mbpd.

Focus on Large-Scale LNG Production for Export: Recognizing the significant market potential and revenue opportunities in Liquefied Natural Gas (LNG), my administration will prioritize and invest in this often-overlooked export sector. This strategic move aims to diversify our export portfolio and strengthen our position in the global energy market.

Reduce Expenditure: I’ve already set the wheels in motion. Beyond strategic initiatives geared towards growth, I’ve identified new sources of expenditure reduction. These new funds stem from measures such as streamlining and optimizing the federal structure, trimming national assembly expenses, curtailing corruption and inefficiencies in public procurement, and tapping into new internal revenue streams such as taxing corporations and the rich.

Increase Taxes: Our nation’s survival hinges on every penny we can muster from internal sources. Unfortunately, the government’s performance in collecting what it is rightfully owed has been dismal. For too long, wealthy individuals and corporations have been allowed to understate their incomes and revenues. Most businesses operating within the informal or underground economy typically do not pay taxes. Tax evasion has become rampant, and the taxes that are paid suffer from a lack of accountability within the tax agency. Such financial negligence ends with my administration. I will ensure that everyone, every entity, contributes their fair share.

My administration will spearhead a formidable team of experts, dedicated to implementing strategic initiatives to significantly boost our internal revenue generation. We will enforce stringent tax compliance, close loopholes, and enhance the efficiency and transparency of our tax system, ensuring a robust financial foundation for our nation’s future.

Implement Progressive Taxation on the Rich: The Personal Income Tax rate for top earners will be revised progressively from 24% to 45% for those earning N100 million and above per year.

Increase Capital Gains Tax Rate: We will raise the capital gains tax from 10% to 15%.

Adjust VAT Rate: The VAT rate will be elevated from 7.5% to 10%.

Increase Corporate Tax Rate: Large corporations, especially those with turnovers surpassing N5 billion, will now face a tax rate of 45%, an increase from 30%.

Increase Petroleum Profit Tax (PPT) Rate: Under production sharing contracts (PSC) with the Nigerian National Petroleum Corporation (NNPC), the PPT will be adjusted from 50% to 60%. Further nuanced adjustments will be made to PPT rates for other categories.

Implement aggressive tax audits and tax collection. My administration will create a special taskforce to ensure that all taxes owed are collected. We will implement aggressive tax audits and tax collection. We will upgrade our tax administration and collection processes by introducing seamless payment systems that minimize human interaction.

Enforce Life Imprisonment for Tax fraud: My government will set up a dedicated court to handle cases of tax fraud. We will enforce strict penalties, including life imprisonment, for tax evasion offenses. Individuals and company owners found guilty of deliberate tax evasion, under-reporting income or revenue, falsifying tax returns, or failing to file a tax return, and tax officials complicit in such criminal activities, will face legal prosecution and the maximum punishment permissible.

Issue Nigeria Renewal Bond (NRB): Under my guidance, we will introduce a Nigeria Renewal Bond that carries interest. Preliminary evaluations suggest that we can successfully mobilize $8 billion through the Nigeria Renewal Bonds.

This bond can either be acquired directly or via financial institutions and is open to all Nigerians. Although the funds generated from these bonds are not designated for a specific project, they will play a pivotal role in supporting the federal government’s mission to enhance infrastructure and fuel our emerging entrepreneurial landscape.

 This bond will resonate with the patriotic sentiments and conscience of our people. Interest payments will be made at set periods, and once purchased, bondholders can hold onto their investment for a decade. The bond’s specifics will be set by the renewed Central Bank of Nigeria (CBN).

Initial feedback indicates significant enthusiasm among the Nigerian diaspora to back this initiative and financially support their homeland’s growth. The complete loan, backed by the federal government, will be repaid upon maturity, with interest earnings being exempt from taxes.

These revenue generation initiatives will add $33 billion to the treasury in my first year in office. Over a decade, these revenue enhancements will funnel an extra $330 billion (see details in table #1 below) into our national treasury, which can be allocated to infrastructure development and other growth-driven projects.