Stakeholders in Nigeria’s financial and business sectors have backed calls for a temporary waiver on late tax returns penalties, saying the measure could unlock voluntary compliance, improve government revenue and ease the burden on companies.

A tax practitioner, Dr Ernest Abegbe, urged the Nigeria Revenue Service (NRS) to introduce a structured and time-bound waiver window that would allow companies to regularise outstanding filings without the weight of accumulated penalties and interest.

His recommendation comes amid sweeping reforms under the tax reform aimed at strengthening compliance, expanding the national tax base and improving revenue generation.

Abegbe noted that while many businesses are willing to comply with tax obligations, penalties and interest accrued over time have created significant financial constraints, discouraging voluntary disclosure and settlement.

“The present reform environment offers a unique opportunity to recalibrate compliance,” he said.

However, he noted, “legacy penalties and accrued interest continue to discourage voluntary disclosure and prompt settlement of outstanding liabilities”.

Industry operators said the proposal aligns with the realities confronting businesses, especially amid prevailing economic pressures, operating costs and ongoing regulatory adjustments.

According to stakeholders, a temporary waiver would encourage thousands of companies to clear outstanding obligations and re-enter the formal compliance system, while enabling the government to unlock immediate revenue from unpaid principal taxes.

They noted that similar initiatives implemented in other jurisdictions have proven effective in expanding the tax net, improving compliance rates and strengthening long-term revenue sustainability.