Nigeria’s Federal Inland Revenue Service (FIRS) reported on Tuesday that the country’s revenue collection soared to N3.64 trillion by September 2025, marking a 411 percent surge from N711 billion in May 2023.
Despite this significant revenue increase, the administration of President Bola Ahmed Tinubu intends to maintain borrowing as a key element of its comprehensive economic and fiscal policy, according to FIRS Executive Chairman Zacch Adedeji.
Speaking to State House correspondents at the recent “Meet-the-Press” series hosted by the Presidential Communications Team, Adedeji explained that borrowing remains a standard part of the nation’s budget and fiscal framework.
“Borrowing is not a problem…is borrowing not part of the budget we submitted to the National Assembly? Was it not approved? Are we borrowing aside what was approved?” he asked.
He clarified that the government’s borrowing is intended for long-term investments, not for immediate expenses like salaries.
“So, if my expenditure for this year is N100,000 and my plan is that N80,000 will be from my revenue, I will borrow N20,000. If I’ve done revenue of N90,000 and I’m borrowing N10,000 according to what I have in my budget, what is the problem with that?” Adedeji said.
He emphasized that borrowing enables governments to mitigate higher future costs and maintain progress on public infrastructure projects, citing the “Matchy Concept,” which advocates funding projects with long-term benefits over time rather than paying for them entirely upfront.
The FIRS chief also responded to critiques of borrowing, which Intensified following President Tinubu’s July request for a $21.5 billion external loan package, comprising a $2 billion foreign currency bond and a N757.98 billion domestic bond to address pension liabilities.
“Don’t forget that banks are part of our economic ecosystem. There is no country or individual in the world that survives based on its own income. When government borrows from banks, it will pay interest. It is from that interest that salaries are paid; it is from salaries that banks pay taxes; and it is from this profit that I collect taxes,” Adedeji explained.
Adedeji credited the revenue surge to reforms that simplified taxation, eased the burden on small businesses, and optimized incentives.
Non-oil revenue saw the most significant growth, soaring from N151 billion to N1.06 trillion during the period, while oil revenue rose to N644 billion.
Value Added Tax (VAT) collections more than tripled, reaching N723 billion, and customs revenue climbed to N322 billion.
The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) and the Nigerian National Petroleum Company (NNPC) Limited played a substantial role in driving the revenue increase.
“Revenue growth alone does not eliminate the need for borrowing. Borrowing is a key element of a sound economic plan and part of the ecosystem for a viable nation. It ensures that investments with long-term benefits can be realised without causing undue strain on current resources,” Adedeji said.
He highlighted ongoing initiatives to maintain revenue growth, such as introducing a new fiscal policy framework, implementing e-invoicing, establishing excise regulations, and standardizing subnational levies.
The FIRS is also considering presumptive taxation for groups that are difficult to tax and lowering corporate tax rates as part of wider constitutional reforms to broaden the tax base.
Adedeji referred to critics of government borrowing as “container economists,” accusing them of relying on superficial analysis and social media narratives without grasping the deeper economic rationale.
He emphasized that borrowing, when aligned with approved budgets, promotes sustainable national development, supports infrastructure projects, and ensures long-term fiscal stability.
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