Nigeria earned an estimated N161.1 trillion in revenues from oil and non-oil sectors in the years spanning 2010 to 2024, with new data showing that tax and non-oil income streams now dominate the country’s fiscal structure.

The report by Quartus Economics, which examined federation revenues during the period, indicated that Nigeria has transitioned from a commodity-dependent system to one where government income is increasingly driven by taxes rather than oil exports.

The firm in its report titled: “Nigeria Unshackled: Inside the Steady Rise of a Fiscal State,” stated that N80.6 trillion or 49.99 per cent was generated from oil-related sources or activities and N80.57 trillion or 50.01 per cent from non-oil sources.

The report also revealed that between 2023-2025, an estimated N62.3 trillion was earned from taxes alone, with the non-oil sector contributing the highest proportion. This transformation, it said, followed more than a decade of economic shocks, policy reforms and structural adjustments triggered by the 2014 global oil price crash.

Before that crisis, it said that oil accounted for roughly three-quarters of Nigeria’s public revenues, leaving government finances highly vulnerable to external shocks.

Between 2014 and 2024, following the oil price crash of 2014, it explained that Nigeria’s Gross Domestic Product (GDP) per capita plunged from over $4,000 to about $1,120, while poverty levels surged, with an additional 65 million Nigerians falling into poverty by 2023.

But over the past decade, and particularly in the last five years, it stated that Nigeria has aggressively expanded its non-oil revenue base through tax reforms, improved collection mechanisms and administrative changes.

“During the 15-year period between 2010 and 2024 (both years inclusive), the Nigerian federation earned N161.1 trillion in revenues: 80.6 trillion (49.99 per cent) from oil-related sources or activities and 80.57 trillion (or 50.01 per cent) from non-oil sources,” it added.

By 2024, it maintained that oil revenues accounted for just about a quarter of total federation revenues, a dramatic decline from pre-crisis levels. In contrast, tax revenues surged, contributing as much as 87 per cent of total revenues, with non-oil taxes forming the bulk of that increase.

With tax revenues nearly tripling between 2022 and 2025, rising from just over N10 trillion to more than N28 trillion, it stressed that within the same period, Nigeria generated about N62 trillion in taxes, with the non-oil sector contributing over 70 per cent.

According to the report, in 2025, tax collection grew by 30 per cent, also driven primarily by non-oil taxes, which accounted for nearly 84 per cent of the growth in federally collected taxes. “Within three years, Nigeria’s tax revenue nearly tripled from N10.18 trillion in 2022 to N28.29 trillion in 2025,” it stated.

It noted that Nigeria’s recent progress with revenue growth and composition may still be modest in view of ongoing reforms in fiscal policy and revenue administration processes.

The report noted that over the last five years, and especially since 2023, Nigeria’s federation revenue grew rapidly and from previously underrated sources, stressing that the revenue growth showed stability and healthy diversification.

“As of 2024 year-end, total revenue was nearly 4x 2019 revenue, and by 2025 year-end, tax collections were more than 5X 2019 levels,” the report revealed.

The analysts at Quartus Economics noted that a decade after the oil price collapse, Nigeria’s revenue base has shifted from concentrated dependence on oil and dominance of non-tax revenue towards a resilient and sustainable mix.

“The contribution of oil to total federally collected revenues is down from 73.9 per cent in 2010 to 25.8 per cent in 2024. Non-oil revenue grew from 25 per cent in 2010 to nearly 75 per cent of revenues by 2024.

“From 44.5 per cent in 2014, non-oil taxes now account for nearly three-quarters (75.9 per cent) of federally collected taxes, as the contribution of oil taxes dropped from nearly 55 per cent in 2015 to less than a quarter in 2025,” it explained.

Despite these gains, the report warned that the legacy of the 2014 crisis continues to weigh heavily on the economy. Chief among these, it said, is the rapid rise in public debt. As revenues collapsed in the years following the oil price crash, the government, it stressed, resorted to borrowing to finance deficits and invest in infrastructure.

As a result, Nigeria’s debt-to-GDP ratio has more than tripled over the past decade, while debt service costs have surged significantly, it stressed.

Debt service as a share of revenue, it pointed out, rose from under 7 per cent in 2012 to nearly 40 per cent in recent years, highlighting the growing burden of repayments on government finances. (THISDAY)

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