The Federal Government yesterday dismissed reports suggesting it was considering introducing new taxes on telecommunications services and petroleum products, following recommendations in the International Monetary Fund (IMF) Article IV Consultation Report on Nigeria.

This was as the IMF projected that Nigeria would spend more than half of its revenue on debt servicing in 2026, according to its latest country assessment, which estimates that the federal government’s interest payments will consume 53.7 per cent of revenue in 2026, up from 53.2 per cent in 2025 and 40.8 per cent in 2024.

The government said the reports misrepresented the contents of the IMF report and did not reflect its policy direction, insisting that no new taxes were being planned for either the telecoms or petroleum sectors.

In a statement signed by the Head of the Information and Public Relations Unit of the Federal Ministry of Finance, EfeOvuakporie, the government stressed that recommendations contained in the IMF report were not binding on Nigeria and should not be interpreted as official government policy.

“The government has dismissed reports suggesting that it has adopted or is considering new taxes on telecommunications services and petroleum products following the publication of IMF’s Article IV Consultation Report on Nigeria,” the statement reads.

The clarification came days after the IMF, in its Article IV report on Nigeria, recommended a range of revenue-enhancing measures to strengthen government revenue and improve fiscal sustainability.

IMF had reportedly recommended introducing taxes on fuel products and telecommunications services in the country as part of broader measures to increase government revenue and create fiscal space for development spending and social interventions.

However, the Federal Government maintained that decisions on taxation could only be made through constitutional and legislative processes and would be guided by national priorities and prevailing economic realities.

“The IMF Article IV Consultation Report contains the Fund’s assessment of Nigeria’s economy as well as recommendations for consideration by the authorities. Those recommendations do not amount to government policy and are not binding on Nigeria.

“Decisions on tax matters are taken through established constitutional and legislative processes and are guided by national priorities and prevailing economic realities,” the statement reads.

The government also clarified that the Value Added Tax (VAT) waiver on petroleum products “remains in force” and has not been withdrawn.

EXPECTING the interest-to-revenue ratio to ease marginally to 52.4 per cent in 2027, the IMF projects improvements in inflation and external reserves, forecasting average inflation of 16 per cent in 2026, while gross international reserves are expected to rise from $40.2 billion in 2024 to $58.1 billion in 2026 and $62 billion in 2027.

Speaking on Arise Television, IMF Resident Representative for Nigeria, Christian Ebeke, said the country’s debt remained sustainable and the risk of sovereign debt distress moderate.

“Our latest assessment in the Article IV that we just published on June 9 basically concludes that Nigeria’s debt is sustainable. Second, the risk of sovereign stress is actually moderate. So we don’t see Nigeria as a high-risk debt-distressed country,” Ebeke said.

He said Nigeria’s debt-to-GDP ratio, which remains in the mid-30 per cent range, compares favourably with many peer countries, adding that Nigeria’s debt portfolio benefits from a balanced mix of domestic and external borrowing and relatively long maturities.

According to Ebeke, the bigger concern is the amount of revenue being used to service debt.

“We actually estimate that in 2025 to 2028, the interest-to-revenue ratio, how much the Federal Government pays out of the tax it collects, is actually about 50 per cent,” he said. “When you have more than 50 per cent of your tax collection devoted to repaying interest on your Federal Government debt, it leaves you very little room to actually pay for health, education, cash transfer and security.”