Economy
Finance Minister laments £360m capital flight to UK education sector
Minister of Finance Mrs Kemi Adeosun has lamented the rate at which Nigerians send their children to school in the United Kingdom that has cost the nation £360 million annually. This she said is capital flight by Nigerians who hardly pay any form of tax to Nigeria government. Adeosun said that the country cannot continue to have a situation where Nigerians alone pay £360 million in the UK for school fees where the tax return of many of the people paying these fees have no connection with their life style and the tax they pay.
Speaking at an interactive session on Voluntary Asset Declaration, VAIDS awareness/Tax organised by PwC in Lagos, Adeosun said that the circle of non compliance must be broken because it is a destructive circle that is not allowing Nigeria to grow, adding that tax is an obligation for every citizen and not an option. She also said that the discovery of oil in commercial quantity is the bane of Nigeria’s tax system. She said that the poor tax compliance in the country is affecting economic growth negatively. This she said has necessitated the introduction of Voluntary Assets and Income Declaration Scheme (VAIDS) .
VAIDS according to the Minister is a time-limited opportunity for tax defaulters to regularise their tax status relating to previous periods. The objective she said is to increase the number of taxpayers in the tax net and raise revenue for the government.
She said “if we did not have oil, we would probably have had a better tax system today and a better level of compliance than we have. Our vision for Nigeria is to have oil plus economy, oil is only 10 per cent of our GDP, so if we did not have oil that 90 percent would be sustained by the economy, so is important we get level of tax compliance working.
“We have to as a people improve in terms of our level of tax compliance. Before oil came, this country was sustained on tax payment both in the South, East, West and North, in the north, it was cattle, cocoa proceeds drove education policies that transformed the south west, groundnut also. When oil came, tax became completely irrelevant.
“From an economic perspective, Nigeria deserves to be a prosperous nation, we have all the natural resources and human endowment to be a prosperous nation but we need to seat down and study what prosperous nations do to become prosperous. If you look at prosperous nations they have one thing in common, they have good tax compliance level in place. If you look at poor nations, they are reluctant in compliance.
“With technology, we now have capacity to drive tax compliance in a way that it has never been seen before, the British, America, everybody signed up to share information on beneficial ownership data, so to an extent there is really no where to hide anymore,” she said.
She said that the scheme is expected to increase Nigeria’s tax to GDP ratio from current six per cent to between 10 and 15 per cent, broaden the national tax base, curb tax evasion and discourage illicit financial flow.
“Most developing countries have tax to GDP ratios at 20 per cent, Nigeria still records a global low of six per cent. The federal ministry of finance, in a bid to address this, set up the VAIDS in collaboration with the 36 states of the federation.
“Tax payers who make full and honest declarations will enjoy waiver of interest and penalty, immunity from prosecution, confidentiality of information supplied, exemption from tax audits for the periods covered by the disclosure and flexible payment of tax due. Taxpayers who fail to participate in the scheme will be investigated and if found culpable will be subject to criminal prosecution,” she said.
Meanwhile, the scheme supported by an executive order commenced on July 1, 2017 to last for a period of nine months and will be implemented by the federal inland revenue in collaboration with all the 36 state Internal Revenue Service and the FCT IRS.
The Arab Africa Trade Bridges (AATB) Program and the Federal Republic of Nigeria formalized a partnership with the signing of the AATB Membership Agreement, officially welcoming Nigeria as the Program’s newest member country. The signing ceremony took place in Abuja on the sidelines of the 5th AATB Board of Governors Meeting, hosted by the Federal Government of Nigeria.
The Membership Agreement was signed by Eng. Adeeb Y. Al Aama, the CEO of the International Islamic Trade Finance Corporation (ITFC) and AATB Program Secretary General, and H.E. Mr. Wale Edun, Minister of Finance and Coordinating Minister of the Economy, Federal Republic of Nigeria. The Agreement will provide a strategic and operational framework to support Nigeria’s efforts in trade competitiveness, promote export diversification, strengthen priority value chains, and advance capacity-building efforts in line with national development priorities. Areas of collaboration will include trade promotion, agribusiness modernization, SME development, businessmen missions, trade facilitation, logistics efficiency, and digital trade readiness.
The Honourable Minister of Finance and Coordinating Minister of the Economy, Mr. Wale Edun, called for deeper trade collaboration between African and Arab nations, stressing the importance of value-added Agribusiness and industrial partnerships for regional growth. Speaking in Abuja at the Agribusiness Matchmaking Forum ahead of the AATB Board of Governors Meeting, the Minister said the shifting global economy makes it essential for African and Arab nations to rely more on regional cooperation, investment and shared markets.
He highlighted projections showing Arab-Africa trade could grow by more than US$37 billion in the next three years and urged partners to prioritize value addition rather than raw commodity exports. He noted that Nigeria’s growing industrial base and upcoming National Single Window reforms will support efficiency, investment and private-sector expansion.
“This is a moment to turn opportunity into action”, he said. “By working together, we can build stronger value chains, create jobs and support prosperity across our regions”, Edun emphasized. “As African and Arab nations embark on this journey of deeper trade collaboration, the potential for growth and development is vast. With a shared vision and commitment to value-added partnerships, we can unlock new opportunities, drive economic growth, and create a brighter future for our people.”
Speaking during the event, Eng. Adeeb Y. Al Aama, Chief Executive Officer of ITFC and Secretary General of the AATB Program, stated: “We are pleased to welcome Nigeria to be part of the AATB Program. Nigeria stands as one of Africa’s most dynamic and resilient economies in Africa, with a rapidly expanding private sector and strong potential across agribusiness, energy, manufacturing, and digital industries. Through this Membership Agreement, we look forward to collaborating closely with Nigerian institutions to strengthen value chains, expand regional market access, enhance trade finance and investment opportunities, and support the country’s development priorities.”
The signing of this Agreement underscores AATB’s continued engagement with African countries and its evolving portfolio of programs supporting trade and investment. In recent years, AATB has worked on initiatives across agribusiness, textiles, logistics, digital trade, export readiness under the AfCFTA framework, and other regional initiatives such as the Common African Agro-Parks (CAAPs) Programme.
With Nigeria’s accession, the AATB Program extends it’s presence in the region and adds a key partner working toward advancing trade-led development and fostering inclusive economic growth.
Federal Executive Council (FEC) has approved the 2026–2028 Medium-Term Expenditure Framework (MTEF), a key fiscal document that outlines Nigeria’s revenue expectations, macroeconomic assumptions, and spending priorities for the next three years. The approval followed Wednesday’s FEC meeting presided over by President Bola Tinubu at the State House, Abuja. The Minister of Budget and Economic Planning, Senator Atiku Bagudu made this known after the meeting.
The Minister said the Federal Government is projecting a total revenue inflow of N34.33 trillion in 2026, including N4.98 trillion expected from government-owned enterprises. Bagudu said that the projected revenue is N6.55 trillion lower than earlier estimates, adding that federal allocations are expected to drop by about N9.4 trillion, representing a 16% decline compared to the 2025 budget.
He said that statutory transfers are expected to amount to about N3 trillion within the same fiscal year. On macroeconomic assumptions, FEC adopted an oil production benchmark of 2.6 million barrels per day (mbpd) for 2026, although a more conservative 1.8 mbpd will be used for budgeting purposes. An oil price benchmark of $64 per barrel and an exchange rate of N1,512 per dollar were also approved.
Bagudu said the exchange rate assumption reflects projections tied to economic and political developments ahead of the 2027 general elections. He said the exchange rate assumption took into account the fiscal outlook ahead of the 2027 general elections.
The minister said that all the parameters were based on macroeconomic analysis by the Budget Office and other relevant agencies. Bagudu said FEC also reviewed comments from cabinet members before approving the Medium-Term Fiscal Expenditure Ceiling (MFTEC), which sets expenditure limits. Earlier, the Senate approved the external borrowing plan of $21.5 billion presented by President Tinubu for consideration The loans, according to the Senate, were part of the MTEF and Fiscal Strategy Paper (FSP) for the 2025 budget.
The spot rate on Nigerian Treasury bills has been increased by 146 basis points by the Central Bank of Nigeria (CBN) following tight subscription levels at the main auction on Wednesday. The spot rate on Treasury bills with one-year maturity has now surpassed Nigeria’s 16.05% inflation by 145 basis points following a recent decision to keep the policy rate at 27%.
The Apex Bank came to the primary market with N700 billion Treasury bills offer size across standard tenors, including 91-day, 182-day and 364 day maturities. Details from the auction results showed that demand settled slightly above the total offers as investors began to seek higher returns on naira assets despite disinflation.
Total subscription came in at about N775 billion versus N700 billion offers floated at the main auction. The results showed rising appetite for duration as investors parked about 90% of their bids on Nigerian Treasury bills with 364 days maturity. The CBN opened N100 billion worth of 91 days bills for subscription, but the offer received underwhelming bids totalling N44.17 billion.
The CBN allotted N42.80 billion for the short-term instrument at the spot rate of 15.30%, the same as the previous auction. Total demand for 182 days Nigerian Treasury bills settled at N33.38 billion as against N150 billion that the authority pushed out for subscription. The CBN raised N30.36 billion from 182 days bills allotted to investors at the spot rate of 15.50%, the same as the previous auction.
Investors staked N697.29 billion on N450 billion in 364-day Treasury bills that was offered for subscription. The CBN raised N636.46 billion from the longest tenor at the spot rate of 17.50%, up from 16.04% at the previous auction.
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