Under Article IV of the IMF’s Articles of Agreement, the IMF holds annual bilateral discussions with member nations. An IMF staff team visits the country, collects information, and discusses the country’s economic developments and policies with government officials. The 2022 Article IV consultation meetings between the IMF team and the representatives of the Nigerian government took place on November 7-18, 2022. The FGN team was made up of the Chief of Staff Professor Gambari, Finance, Budget and Planning Minister Ahmed, Agriculture Minister Mahmood, EnvironmentMinister Abdullahi, Petroleum Minister Sylva, Central Bank of Nigeria Governor Emefiele, and other senior government officials. At the end of the meeting, the IMF made key policy recommendations for the incoming 2023 Nigerian government. These policy recommendations were then transformed into conditionalities for future loans. 

The IMF recommendation for the incoming Tinubu government on fiscal policies stated, “Policypriorities include permanent removal of fuel subsidies by mid-2023 as planned, stoppage of oil theft,improved tax compliance through automation, taxpayer segmentation, customs modernization andrationalization of tax incentives, and adoption of excise and VAT rates similar to those prevailing inpeer countries in West Africa.” In accordance with these IMF recommendation, President Tinubu firstremoved “fuel subsidies” and then set up a committee that will work to “enhance revenue collectionefficiency, ensure transparent reporting, and promote the effective utilization of tax and other revenues,”. Increased taxation of the poor reduces household income and increases poverty withoutany benefits or government services.

The Tinubu government plans to tax market traders and others in the informal sector through FIRS by working with the Market Traders Association of Nigeria (MATAN) in a program called the VAT DirectInitiative. MATAN members will each receive an ID card upon enumeration, which would contain theirTax Identification Number (TIN) and other personal details. It is not clear if Miyetti Allah CattleBreeders Association of Nigeria (MACBAN) and the Cocoa Farmers Association of Nigeria (CFAN) are also included in the VAT Direct Initiative and their members given ID cards, TIN and taxed. The Tinubu government has chosen to ignore the historical capacity of the Nigerian peasants to organize and resist government attempts to reduce their household income by increased taxation. We will examine some of the historical struggles of Nigerian labouring classes against taxation starting from the attempt of the colonial government to introduce direct taxation in 1927.

In 1927, the colonial State decided to introduce direct taxation in Nigeria to generate more revenue.The direct taxation bill was to be published in February 1927 and enacted in April of that year. The enactment was to be followed immediately by a grand propaganda campaign in favour of direct taxation at the village level. After this, a census was to be conducted and finally direct taxation was to be imposed in April 1928. The Resident, with the aid of the warrant chiefs, was then to assess the value of each peasant’s land, crops, livestock, and his profits from trade. He was to set a poll tax levy based on these assessments. The first part of the plan went off without any trouble. The bill, known as the Native Revenue (Amendment) Ordinance, was published in February 1927, and passed two months later. Then the officials of the State started their propaganda tour and met with resistance and a lack of interest by Nigerians.

In response to the failure of the propaganda part of the plan, the Colonial State passed the IncomeTax Ordinance No.23 of 1927. This ordinance provided for the levy and collection of a tax assessed upon the chargeable income payable annually by every adult male living in the colony of Nigeria. It went into effect in April 1928. The State also prepared to militarily crush all resistance to direct taxation. The new Governor of Nigeria wrote, “In view of the approaching institution of taxation in the southern provinces, an increase of 500 rank and file was granted during the year (1927), as a temporary measure and these have been distributed throughout the provinces so that a mobile body of men should be in readiness should any emergency arise.” With this military preparedness, the execution of the plan was set into motion. The census and assessment programs were carried out in all affected towns and villages. Taxable wealth, in practice, included the peasant’s wives, his children, livestock and every article of value in his household. 

The peasants’ response was to agitate, mobilize and resist. The Resident of the Warri province reported, “In August 1927, an anti-tax agitation sprang up in the Warri province. Overt acts of lawlessness occurred in the Warri and Kwale divisions. On the 30th of September, a turbulent demonstration against the officer administering the Government ended in a riot in which police were forced to fire on the crowd. The Warri province was declared a proclaimed district under the PeacePreservation Ordinance by a proclamation dated the 30th of November. By the end of the year, the ring leaders of the agitation had been brought to trial, conditions in the provinces became normal and the proclamation of the 30th of November was cancelled on the 29th of December.”

In the South Eastern part of Nigeria, the peasants also agitated, mobilized and protested. Tax rates ranged from 4s. to 6s. per adult male. Many peasants refused to pay the taxes until the military patrols and escorts visited their villages. Military escorts visited Awka (Onitsha province) in late 1927and Nsukka in early 1928. Despite all the visiting, by April 1928, only £357,267 had been collected.The peasants usually renewed their agitation once the military patrols or escorts had left. Thus, the escorts and patrols were still visiting places after April 1928. For example, in July 1928, an escort of one European officer and thirty rank and file accompanied the District Officer to Obodo, Warri province, where anti-tax agitation was feared. In September, an escort of one European Officer and twenty rank and file accompanied the District Officer to Ogume in the Kwale division of the Warri province in connection with anti-tax agitation. The situation became so dangerous that for the whole of 1928, the Colonial State provided all its administrators in the areas where direct taxation was recently imposed with permanent armed escorts. However, the peasant resistance to direct taxation was not limited to the Middle Western and South Eastern provinces. 

In the South Western and Northern provinces where direct taxation was not new, the peasants also agitated, mobilized and resisted. For example, in June and July 1928, anti-tax agitation took place in the Owo division of the Ondo province in South Western Nigeria. An escort of three European officers and eighty rank and file proceeded there by motor transport and arrested protesters. In the Idoma division of Benue province in Northern Nigeria, the resistance against taxation was met by a visit from a police escort. Continued resistance forced the State to change the police escort to a military patrol within a month. Twelve months later, the colonial troops were still occupying Idoma division in a futile attempt to capture the leaders of the peasant revolt and to pacify the peasant insurgents. At Muraye in Sokoto province, Northern Nigeria, the peasants killed the tax collector and village headman. This stopped the tax collection exercise. The peasants then took up arms to prevent the appointment of another village headman and tax collector. A military patrol was sent to subdue them.The peasant resistance was so strong that by the time the peasants laid down their arms, the State was satisfied with just being able to preserve the institution of indirect rule. The State chose not to antagonise the peasants any further by collecting the 1928 taxes. 

At the end of 1928, therefore, the colonial State had succeeded in establishing the institutions of direct taxation. However, this was not achieved without the active opposition of the Nigerian people.Some people who did not pay their taxes were caught, tried, and jailed. Those who paid their taxes had their income appropriated by the State and their household income reduced. In the SouthEastern provinces the issue was far from being settled. 1929 was to be a year of mass revolt against direct taxation. It was conducted principally by women and became known in history as the Aba women revolt. We will tell this story next time. Suffice it to note, that the Nigerian masses in the informal sector and farmers in rural areas will resist the IMF imposed increased taxation policies of the Tinubu government. This is our first history lesson.

Izielen Agbon 



July 25, 2023. 


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