How Nigeria plans to use banks and fintechs to recover tax debt
- From 2026, banks and fintechs will serve as debt recovery agents for Nigeria's tax authority under the new Nigeria Tax Administration Act, 2025.
- The Federal Inland Revenue Service (FIRS) has been replaced by the Nigeria Revenue Service (NRS), marking a significant overhaul in tax administration.
- The NRS can outsource tax debt recovery to banks and financial institutions, allowing direct recovery from taxpayers' accounts after statutory steps are exhausted.
While the new tax reforms in Nigeria aim to enhance compliance and increase revenue, the reliance on banks and fintechs as debt recovery agents raises significant concerns regarding oversight and the potential for abuse. It is crucial for the government to establish clear safeguards to protect taxpayers and ensure fair practices in the recovery process.
