Nigeria has signed a new memorandum of understanding (MoU) with France to rewrite its tax framework for the digital economy, aiming to increase tax revenues beyond its borders.
Under the terms of the MoU, France’s tax authority, the Direction Générale des Finances Publiques (DGFiP), will assist Nigeria’s Federal Inland Revenue Service (FIRS) in consolidating its capacity to track and tax online revenue in Africa’s leading economy.
The collaboration was signed before January 2026, when Nigeria’s new tax system takes effect. Under the new tax regime, FIRS will transition into the Nigeria Revenue Service. The collaboration reflects Nigeria’s push to modernize its revenue system as governments worldwide race to tax digital activity that often escapes traditional rules tied to physical presence.
“If the FIRS does not apply what it is doing now, the tech companies will continue to evade tax in Nigeria,” said Godwin Ukah, an Abuja-based economist and tax consultant, in an interview. He argues that if the local tax authority lacks high-tech capabilities, it will be unable to track foreign companies that use advanced methods.
“Anything that can enhance tax revenue collection that this partnership can bring is welcome. This partnership, coming simultaneously with the new tax laws, will make it more efficient, especially by combining it with enhanced technological capability,” he added. Ukah noted that DGFiP’s advanced system makes it a choice partner for the Nigerian agency.
Some Nigerians have argued that the agreement could endanger Nigeria’s tax system. The partnership enables Nigeria to learn from that experience and is “advisory, non-intrusive, and entirely under Nigeria’s control,” according to officials. The new tax system reduced the corporate tax rate for medium and large firms to 25% from 30% and exempted smaller firms with profits below a certain threshold from income tax, under four new laws signed by President Bola Tinubu in 2025. The reform aims to raise tax revenue in a country where the tax-to-GDP ratio was estimated at 13.5% by Tinubu and 9.4% by the IMF in 2023.
