FIRS moves to curb tax evasion and stop illicit financial outflows

The Federal Inland Revenue Service (FIRS) has intensified its campaign to curb tax evasion and halt illicit financial flows in Nigeria as part of broader efforts to improve national revenue and strengthen the integrity of the country’s fiscal framework. The tax authority has unveiled a multi-pronged strategy that includes stronger enforcement, inter-agency cooperation, enhanced data analytics, and new legislative backing to tackle financial leakages and improve compliance.

In a statement issued by the agency, FIRS Chairman Zacch Adedeji emphasized the urgency of tackling tax avoidance and capital flight, both of which have undermined the government’s ability to mobilize domestic revenue for critical development needs. He stated that the agency was deploying cutting-edge technology to track and analyze financial transactions and monitor the activities of companies and individuals suspected of engaging in tax evasion or illegal transfers of funds abroad.

Adedeji highlighted that Nigeria loses billions of naira annually due to complex schemes employed by multinational corporations and some high-net-worth individuals to shift profits to low-tax jurisdictions or conceal income. He explained that the FIRS is now better equipped than ever to detect these practices through real-time access to financial data, integration with other regulatory databases, and partnerships with global tax organizations.

He also revealed that the agency has signed several information-sharing agreements with foreign tax authorities under international frameworks such as the Common Reporting Standard (CRS) and the OECD’s Base Erosion and Profit Shifting (BEPS) initiative. These partnerships are expected to provide Nigerian tax officials with direct insight into offshore accounts, hidden assets, and cross-border financial arrangements designed to dodge tax obligations.

As part of its renewed mandate, the FIRS has also begun collaborating closely with the Central Bank of Nigeria (CBN), the Nigerian Financial Intelligence Unit (NFIU), and the Economic and Financial Crimes Commission (EFCC) to identify and prosecute offenders. These collaborations are focused on tracing suspicious transactions, enforcing compliance, and blocking channels used to move untaxed funds out of the country.

Recent efforts by the FIRS have already begun to yield results. According to the agency, a number of high-profile audits are underway involving companies in sectors such as oil and gas, telecommunications, real estate, and fintech. The agency claims to have uncovered discrepancies in tax filings and is currently engaging affected companies in discussions while preparing to take legal action where necessary.

The FIRS boss warned that the era of weak enforcement and voluntary compliance without verification was over. He stressed that all eligible taxpayers, including digital businesses and cross-border service providers, would now be brought under the tax net. Adedeji pointed out that new guidelines have been developed to capture value-added tax (VAT) from digital transactions and online platforms, many of which had previously operated outside the tax framework.

Financial analysts and economic stakeholders have applauded the move, noting that addressing tax evasion and illicit flows is essential to achieving fiscal sustainability, reducing reliance on external borrowing, and funding infrastructure and social development projects. Some experts believe that Nigeria must now focus on expanding its tax base by formalizing the informal sector, closing tax loopholes, and ensuring that large corporate entities pay their fair share.

However, business owners and private sector representatives have urged the FIRS to ensure that the crackdown does not stifle economic activity or punish honest taxpayers. They called for clearer guidelines, transparent dispute resolution processes, and stakeholder engagement to avoid unintended disruptions. A Lagos-based business consultant remarked that while clamping down on tax evasion is necessary, it must be balanced with support for business growth, especially for small and medium enterprises.

In response, the FIRS chairman assured stakeholders that the agency’s aim is not to create fear but to ensure fairness and accountability in the tax system. He noted that the service is working to simplify tax compliance through digital platforms, automate filing systems, and reduce bottlenecks in the tax payment process.

He also pledged to intensify taxpayer education campaigns across the country to inform businesses and individuals about their obligations and how to meet them. According to him, voluntary compliance remains the preferred approach, but the agency will not hesitate to apply the full weight of the law against persistent defaulters and tax evaders.

As Nigeria seeks to boost non-oil revenue and foster a more transparent financial system, the FIRS’s campaign against tax evasion and illicit financial flows is seen as a critical step toward restoring confidence in public finance management. With stronger oversight, better technology, and enhanced collaboration, the agency believes it is now positioned to close revenue gaps, hold offenders accountable, and ensure that every eligible taxpayer contributes to the country’s growth and development.