The Executive Chairman of the Nigeria Revenue Service, Zacch Adedeji, on Tuesday said inflation in Nigeria could have risen as high as 120 per cent without the sweeping economic reforms introduced by the Federal Government. Adedeji stated this in Abuja during the commissioning of the NRS headquarters, noting that the reforms helped to stabilise prices and restore macroeconomic balance.
He said, “If you’ve not taken that decision, Mr President… the inflation will have been 75 to 120 per cent. Today, inflation is around 15 per cent and declining.” The NRS chairman explained that the country was at a critical economic turning point before the reforms, with rising inflation, fiscal imbalances, and structural distortions threatening stability.
According to him, “When this administration assumed office, Nigeria faced a critical inflexion point, marked by constrained fiscal space, weakened investor confidence and structural distortions across key sectors.” He noted that the policy shift was not incremental but a comprehensive reset of the nation’s economic framework, driven by difficult but necessary decisions.
Adedeji identified three key reforms, fuel subsidy removal, exchange rate unification, and the naira-for-crude initiative, as central to reversing the country’s economic trajectory. Data presented during his address showed that without these policies, inflation could have surged to between 75 per cent and 120 per cent annually, compared to about 15 per cent currently.
He also warned that retaining the fuel subsidy would have severely distorted public finances, noting that at a $120 per barrel oil price, subsidy payments could have reached between N38tn and N52tn annually, consuming as much as 76 per cent of the Federal Government’s N68tn budget.
“Just imagine that N52tn out of N68tn would have gone to fuel subsidy. That would have been 76 per cent of total spending,” he said, stressing that the decision to scrap the subsidy was a fiscal necessity rather than a policy option. On the foreign exchange market, Adedeji said the unification of rates eliminated distortions that previously fuelled inflationary pressures and arbitrage.
He noted that prior to the reforms, the official exchange rate ranged between N460 and N700 to the dollar, while the parallel market traded between N3,500 and N4,500, widening price instability across the economy. According to him, the reforms have helped to stabilise the exchange rate, improve investor confidence, and reduce inflationary pressures.
The NRS chairman further said the reforms had strengthened Nigeria’s external position, with net reserves rising significantly compared to pre-reform levels. “If you hadn’t taken that decision, our net reserves would have been below $2bn. Today, they are about $34bn,” he added.
Adedeji also highlighted improvements in fiscal performance, stating that domestic revenue had risen sharply in recent years due to tax reforms and improved compliance. He said revenue collections increased from about N6.8tn five years ago to N28.7tn in 2025, reflecting what he described as the impact of disciplined reforms and stronger governance.
Adedeji added that over 60 fragmented tax laws had been streamlined into a more coherent system, improving efficiency, predictability, and compliance without increasing the tax burden. He also pointed to improvements in fiscal governance, including tighter controls on public financial flows, enhanced transparency, and the introduction of the National Single Window to modernise trade processes.