The African Development Bank (AfDB) Group has approved a $5.52 million grant to strengthen tax administration and improve domestic revenue mobilization in Nigeria and other West African countries.
The development was disclosed in a statement published by the AfDB Group over the weekend, announcing the signing of the grant agreement between the bank and the West African Tax Administration Forum (WATAF).
The initiative is expected to help participating countries modernize tax administration, strengthen governance systems, and improve revenue collection to support development priorities across the region.
What they are saying
The African Development Bank said strengthening tax administration remains critical for West African countries seeking to increase domestic revenue and reduce dependence on external borrowing. The bank noted that stronger tax systems will create the fiscal space needed for governments to finance development priorities.
- “Strengthening tax administration is essential for creating the fiscal space needed to support economic development across West Africa,”said Abdul B. Kamara, Director General of the AfDB Group for Nigeria.
- “The project will help governments enhance efficiency in revenue collection, curb leakages, and strengthen governance in both domestic taxation and the management of extractive sector revenues,” he added.
Jules Tapsoba, Executive Secretary of WATAF, described the initiative as “a major milestone,” noting that it represents the first region-wide tax administration project financed by the AfDB Group.
The AfDB added that the project will also encourage regional collaboration among tax authorities through WATAF and the Economic Community of West African States (ECOWAS).
More insights
The grant agreement launches the Strengthening Tax Administration Capacity Project in West Africa (STACP-WA), a program aimed at improving the ability of governments to mobilize, manage, and safeguard domestic revenues.
- The funding will be provided through the African Development Fund under its Transition Support Facility.
- The project will support tax administrations in six West African countries: Burkina Faso, Guinea, Guinea-Bissau, The Gambia, Liberia, and Sierra Leone.
- Governments will receive technical support to modernize tax and customs administration and strengthen oversight of natural resource revenues.
Digital tools will be deployed to improve efficiency and transparency in revenue collection and help reduce illicit financial flows and revenue leakages.
The project will run until July 30, 2030, with oversight from a Project Steering Committee comprising representatives from WATAF, ECOWAS, and participating countries.
A dedicated Project Implementation Unit within WATAF will coordinate the day-to-day execution of the initiative.
What you should know
In a sweeping tax reform, Nigeria’s President Bola Tinubu recently signed into law a set of four tax reform bills: Nigeria Tax Act, 2025; Nigeria Tax Administration Act, 2025; Joint Revenue Board of Nigeria (Establishment) Act, 2025; and the Nigeria Revenue Service (Establishment) Act, 2025.
- The new tax laws, which became operational on January 1, 2026, are expected to significantly transform tax administration in the country, leading to increased revenue generation, improved business environment, and a boost in domestic and foreign investments.
- With the AfDB initiative Nigeria and other ECOWAS countries will benefit from digital platforms, analytical tools, and policy knowledge products developed under the project.
- Nigeria’s tax authorities are also expected to contribute technical expertise during implementation.
Nigeria Revenue Service will work alongside WATAF and ECOWAS to support technical delivery and knowledge sharing across participating countries.
Key deliverables include the development of an electronic invoicing toolkit and improved transfer-pricing assessment tools for the extractive sector.
- Training modules aligned with the African Continental Free Trade Area framework will also be introduced to strengthen regional tax systems.
- Additional support will target Value Added Tax administration, customs valuation, mining sector governance, and gender-responsive tax policy.
According to AfDB officials, strengthening tax systems is a critical step toward improving fiscal resilience and enabling governments across West Africa to finance development projects without excessive reliance on borrowing.
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