Businesses seek joint tax audits as federal, state authorities face coordination gaps

Businesses are seeking better coordination between federal and state authorities, including joint audits, as stakeholders say overlapping tax engagements remain one of the weak areas in the implementation of Nigeria’s new tax regime.

Emeka Chime, tax partner at PwC, said businesses want the Nigeria Revenue Service (NRS) and state authorities to work together more closely to reduce repeated audits and compliance issues.

“The law provides a framework for joint audits, and so that is something that tax payers have to see being implemented”, Chime said at the 2026 LCCI-OPS Stakeholders’ Forum on Emerging Tax Matters in Lagos.

He emphasised that businesses currently face situations where they may undergo an audit by the NRS and subsequently receive another audit by the Lagos State Internal Revenue Service (LIRS), thereby creating additional compliance demands.

This was noted as businesses adjust to the tax reforms that took effect in 2026, with stakeholders at the forum stating that implementation will depend not only on the legislation but also on how easily businesses can comply.

The Executive Chairman of LIRS, represented by Mustafa Foluso, the director of tax audit, said tax reform will succeed better if taxpayers understood the changes, ensures compliance and have confidence in how the system was administered.

“Compliance should be made easier, less costly for those willing to comply, while deliberate non compliance should become easier to identify,” he said.

He added that technology and data would better shape tax administration by helping authorities understand taxpayers’ behaviour, identify compliance risks and provide more targeted services.

The LIRS representative also identified simplification, engagement and collaboration as top key priorities for the next phase of implementation.

Meanwhile, Richard Ayibiowu, president and chairman of the Nigeria Employers’ Consultative Association (NECA), said taxpayers were now embracing their obligations more but still expected clearer benefits from paying taxes.

He reflected on the popular Lagos slogan “Sanwo Ori e, Jaiye lo” meaning “Pay your tax, enjoy yourself” emphasising that taxpayers were still looking for more in terms of enjoying the benefits of taxation.

He said taxpayers were still looking for actual evidence that their tax payments were translating into development and tangible benefits.

The Chartered Institute of Directors Nigeria similarly urged continued engagement between government, tax authorities and the private sector, alongside greater use of technology and data to reduce duplication and unnecessary physical interaction.

The institute said tax reform should not be judged solely by higher revenue but also by whether it improves compliance, broadens the tax base, and strengthen taxpayer confidence.

The forum therefore highlighted an early test for Nigeria’s tax reforms: whether increased revenue and compliance can be matched by a tax system that is clearer, more coordinated, and easier for taxpayers to navigate.