July 19, (THEWILL) — Despite the tax reform framework in Nigeria and the associated laws, the initiative has not delivered the expected relief to the business environment, consequently compromising the operational landscape to the detriment of logistics and courier companies.
The new tax regime aims to streamline the tax system, lessen compliance burdens, and increase revenue. These objectives led to modernising the framework by merging numerous laws from more than 60 distinct taxes into fewer than 10 clearly articulated statutes, while also improving tax administration.
Analysts and industry experts emphasise that the launch of the new tax legislations has significantly transformed Nigeria’s fiscal policy framework, with far-reaching consequences for the macroeconomic environment and a remarkable impact on individuals, families, and businesses. They also argue that the reforms prioritise fairness – replacing regressive ‘nuisance taxes’ with a modern framework that aligns with international best practices.
However, while the tax reforms and the new tax administration framework seek to eliminate multiple taxation, roadside levies and illegal collections, many courier, logistics and haulage companies say the reality on Nigerian roads remains largely unchanged. Investigations have shown that implementation of the reforms remains weak in several states. Industry operators, who spoke to THEWILL disclosed that the state and local governments councils and their agents continue to impose numerous formal and informal charges.
The following are the most common taxes, levies and illegal charges still reportedly imposed on logistics and courier operators:
- Multiple road stickers issued by different state agencies.
- Local government haulage permits.
- Loading and off-loading levies.
- Vehicle entry permits into markets and industrial estates.
- Daily motor park tickets.
- Environmental sanitation levy.
- Environmental development levy.
- Signage permit on delivery vans carrying company logos.
- Radio and television licence enforcement charges on business premises.
- Business premises levy (sometimes duplicated by local authorities).
- Road maintenance levy.
- Infrastructure development levy.
- Traffic management fines imposed outside legal procedures.
- Local government revenue tickets collected at roadblocks.
- Union tickets demanded by transport unions.
- Truck parking levy.
- Market access levy.
- Produce movement levy (especially agricultural products).
- Container movement levy.
- Vehicle inspection fees outside statutory inspections.
- Vehicle fumigation or disinfection fees.
- Local security or vigilante levy.
- Community development levy demanded by host communities.
- “Settlement” payments to task forces at checkpoints.
- Illegal checkpoint extortion by revenue agents.
- Interstate transit permits issued by some states despite national harmonisation.
- Weighbridge-related unofficial payments.
- Driver identification permit fees.
- Fleet registration fees imposed by some state agencies.
- Courier dispatch rider permit fees in some cities.
- Local government operational permit.
- Business enumeration fees.
- Fire service compliance fees demanded by local authorities.
- Refuse collection levy on logistics depots.
- Commercial vehicle colour permit or branding levy.
- Vehicle ownership verification fees.
- State transport ministry operational fees.
- Logistics company registration with state transport agencies.
- Gate pass fees at state-owned facilities.
- Revenue collection “consultancy” charges by private agents acting for governments.
The President of the Logistics & Courier Association of Nigeria, Okay Ubah, informed THEWILL that his members are facing the burden of numerous taxes and unlawful levies imposed by state and local governments throughout the nation, whose revenue officials are known to intimidate operators on the roads. He elaborated that after fulfilling the required statutory taxes at both corporate and individual levels, state and local government revenue officials confront their members, particularly the dispatch riders, on the streets. In certain instances, they confiscate their vehicles or detain the operators.
“Several of our members have abandoned the business due to their inability to endure the relentless harassment from state and local government revenue officials. Their behaviour is uncivil and ruthless. No amount of documentation will appease them if you do not possess their specific documents,” Ubah stated,
A revenue officer at the Alimosho Local Government headquarters in Akowonjo, Lagos, who requested to remain anonymous due to lack of authorisation to speak to the media, contested the claim that the local government is enforcing illegal taxes and levies on logistics and courier services. He maintained that the taxes and levies imposed on operators are standard. “Nigerians are reluctant to pay taxes. We are functioning within the legal framework,” he asserted, declining to engage in further discussion.
Muda Yusuf, the Chief Executive Officer of the Centre for Promotion of Private Enterprise (CPPE), has denounced the inappropriate conduct of state and local government officials who are sent to extort money from motorists and businesses during their illegal revenue collection efforts.
Yusuf emphasised that the law permits the Joint Tax Board to consolidate the numerous taxes and levies imposed on individuals and businesses by the lower tiers of government. He pointed out that the actions of state and local governments engaging in these unlawful revenue collection practices pose a significant threat to businesses, as they undermine the ease of conducting business. He emphasised that the actions taken by state and local governments deter investment and hinder economic growth.
He remarked that, despite the obligation for states to domesticate the new tax laws aimed at eliminating multiple taxes and illegal levies within their jurisdictions, this requirement has been disregarded. “It is inappropriate to employ touts and miscreants for revenue collection in a manner not sanctioned by law,” Yusuf stated.
The former President of the Chartered Institute of Taxation of Nigeria (CITN), Mrs. Gladys Simplice, denounced the unlawful revenue collection practices by various states and local governments throughout the nation. She encouraged Nigerians to visit the Nigeria Revenue Service (NRS) offices to obtain complimentary copies of the new tax laws, enabling them to familiarise themselves with the legislative provisions and seek recourse against exploitation by states and local government councils.
Tomi Akinwale, a chartered accountant and tax expert, stated that the solution lies in having the national assembly amend the 1999 constitution to remove the authority of states and local governments to impose such taxes and levies.
Reign of uncertainty
For seamless and transparent implementation of the new tax legislations, the government has constituted the National Tax Policy Implementation Committee. There is also Office of the Tax Ombuds (OTO) created to mediate complaints and resolve grievances between tax authorities and the public. The Act retained the establishment of the Tax Appeal Tribunal to exercise jurisdiction over disputes arising from the Nigeria Tax Act, 2025, and Nigeria Tax Administration Act, 2025.
However, the states and local governments are not likely to benefit from the new tax system for now. The residents who do not fall into the categories of citizens whom the new tax laws are meant to benefit, will continue to suffer the pains of the old order.
Small businesses at the sub-national level are still writhing on the throes of multiple taxes, excess levies and over-reaching arms of the law created by authorities of these tiers of government. Often, the laws are enforced in the most brutal manner which has been the culture over the years.
Consequently, on a daily basis, these people are confronted with the realities of an atypical order, raised to state priority and executed willfully by officials of government without restraint. How do the new tax laws protect such vulnerable entities?
Taiwo Oyedele, the Minister of Finance and Coordinating Minister for the Economy, previously stated during the awareness campaign for the new tax reform that those affected by the numerous taxes and unlawful levies would have to endure the irregular system until the necessary constitutional amendments are implemented.
Sam Diala is a Bloomberg Certified Financial Journalist with over a decade of experience in reporting Business and Economy. He is Business Editor at THEWILL Newspaper, and believes that work, not wishes, creates wealth.
