Abuja: An NGO, IdeaPlus Foundation, says inadequate knowledge of tax laws is creating compliance challenges for non-profit organisations across Nigeria, urging stronger collaboration among stakeholders. Co-founder of the foundation, Mr. Dayo Olaide, stated this at the National Policy Dialogue on Nonprofit Taxation in Nigeria on Tuesday in Abuja.
According to News Agency of Nigeria, the occasion was also used to launch a report titled “Compliance or Constriction? Assessing the Nigeria Revenue Service Tax Drive and Its Impact on the Sustainability of Nigerian Civil Society” by the foundation. Olaide said the research revealed significant knowledge gaps on withholding tax, Value Added Tax (VAT), and stamp duties within the non-profit sector. He noted that many organisations had undergone tax audits and received substantial tax demands, raising concerns over their capacity to meet statutory obligations.
Olaide explained that the study seeks to determine whether compliance failures stem from deliberate tax avoidance or inadequate institutional capacity to implement tax requirements. He urged civil society organisations to strengthen internal systems for tracking tax obligations and ensuring timely compliance with relevant tax laws. The co-founder also called on Nigeria Revenue Service (NRS) to provide guidance and capacity building while urging donors to support tax research, evidence gathering, and advocacy.
A chartered accountant, Mr. Oladimeji Ayoola, emphasized the importance of documentation and record-keeping for taxation, stressing that every expenditure must be supported by evidence to avoid higher tax liabilities. Ayoola, an ICAN fellow, described taxation as the implementation of tax laws into accounting, urging organisations and individuals to understand their tax obligations and recognize taxes as contributions to support government responsibilities. While stating that the Nigerian Tax Act had unified multiple tax laws into one framework, he called for sustained public sensitisation by NRS to improve compliance and tax education.
Dr. Titilayo Enitanfowokan, Deputy Vice-President of the Chartered Institute of Taxation of Nigeria, highlighted the changes in Nigeria’s tax environment, which require civil society and non-profit organisations to understand tax laws and obligations and establish processes that ensure full compliance. She advised organisations to include tax obligations, consultancy, and compliance support costs in donor-funded project budgets to avoid unexpected liabilities and ensure adequate funding. Enitanfowokan emphasized that compliance helps organisations avoid additional costs from taxes, penalties, and interest, and called for clearer guidance from tax authorities to improve understanding of compliance requirements.
Chairman of NRS, Dr. Zacch Adedeji, urged CSOs to comply with the laws of the land and called on Nigerians to adhere to tax obligations in accordance with the law. Represented by the NRS Director of Tax Policy and Advisory, Mrs. Bolanle Azeez, Adedeji explained that the new tax incentives had reduced tax burdens for CSOs and NGOs.
Auwal Rafsanjani, Executive Director of the Civil Society Legislative and Advocacy Centre (CISLAC), solicited greater understanding from revenue collection institutions. Rafsanjani expressed NGOs’ support for tax compliance but warned that excessive demands could cripple smaller organisations struggling with funding, staffing, and service delivery. He called for sustained dialogue involving NGOs, the National Assembly, and revenue agencies to identify compliance obstacles and develop practical solutions that would benefit both government and civil society. Rafsanjani welcomed tax education initiatives, saying they would reduce compliance mistakes and provide forums for organisations to address challenges while meeting their legal tax obligations.
NAN reports that the engagement brought together policymakers, tax authorities, civil society organisations, development partners, and professional bodies. The dialogue focused on how Nigeria could strengthen domestic revenue mobilisation while supporting a vibrant and sustainable non-profit sector.