The Executive Chairman of the Federal Inland Revenue Service (FIRS), Dr. Zacch Adedeji, has raised alarm over Nigeria’s massive annual loss of $18 billion to illicit financial flows, describing it as a major threat to the country’s economic stability.
Adedeji made this disclosure on Tuesday at a national conference on Illicit Financial Flows (IFFs) hosted by the FIRS in Abuja. He said the loss is largely driven by aggressive tax avoidance schemes orchestrated by multinational corporations and aided by outdated tax treaties.
“Like many other resource-constrained nations, we lose billions—$18 billion every year—through illicit conduits,” Adedeji said. “This is more than just a policy conversation; it is a national emergency.”
He revealed that the agency is actively reviewing Nigeria’s Double Taxation Agreements (DTAs) to plug loopholes that facilitate profit shifting and capital flight.
“Some of these treaties, due to obsolete clauses, have become tools for exploitation. I have personally commenced renegotiations with several jurisdictions to update these agreements and safeguard Nigeria’s interests,” he added.
As part of a broader crackdown, Adedeji said the FIRS has set up a Proceeds of Crime Management and Illicit Financial Flows Coordination Directorate, empowered by the Proceeds of Crime Act (2022), to coordinate efforts with law enforcement agencies, the judiciary, private sector players, and international development bodies.
Also speaking at the event, Irene Ovonji-Odida, a member of the Mbeki High Level Panel on Illicit Financial Flows, disclosed that African nations collectively lost a staggering $407 billion to IFFs between 2001 and 2010.
According to her, Nigeria remains one of the biggest contributors to the losses in West Africa.
“Trade mispricing alone accounted for 65% of these losses. Organised crime contributed 30%, while 5% came from official corruption and bribery,” she stated.
Ovonji-Odida warned that unless countries like Nigeria close the gaps in financial regulations, the continent will remain trapped in a cycle of underdevelopment.
Also addressing participants, the Minister of State for Finance, Dr. Doris Uzoka-Anite, stressed that combating IFFs requires collaboration beyond the FIRS.
“This fight cannot be left to one agency. It demands a whole-of-government and whole-of-society response,” she said.
“We must enhance inter-agency cooperation, improve data sharing, and implement real-time financial tracking mechanisms.”
Uzoka-Anite added that the Ministry of Finance is currently implementing a strategy based on three key pillars: policy alignment, legislative reform, and international cooperation.
The conference brought together key stakeholders from government, civil society, and international organisations to deepen Nigeria’s response to financial crimes draining the country’s revenues.
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