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No meaningful development can take root in any economy without the government providing a conducive environment for businesses to thrive. This concept commonly referred to as the Business Enabling Environment (BEE) or, more contemporarily, Ease of Doing Business (EODB) cannot be actualised without a thorough reform of the tax system and related regulatory frameworks.
This article seeks to examine the synergy between tax reform and EODB, with a view to proposing practical steps that can reposition Nigeria’s economy for sustainable growth and global competitiveness.
Read also: Senate completes passage of tax reform bills
Understanding tax reform
Tax reform refers to a comprehensive restructuring of the policies, laws, and administrative procedures guiding how taxes are assessed, collected, and managed by the government. It is not merely about increasing revenue; it is about making the tax system fairer, simpler, and more aligned with modern economic realities.
Objectives of tax reform
A robust tax reform agenda is expected to achieve the following:
Repeal outdated tax laws and enact modern, business-friendly alternatives;
Consolidate multiple taxes into fewer, streamlined instruments;
Harmonise tax collection processes across federal, state, and local levels;
Improve tax administration to meet global standards;
Expand the tax base without increasing the tax burden;
Guarantee a predictable and favourable fiscal environment for investors;
Encourage voluntary compliance and reduce opportunities for evasion;
Ultimately, enhance Nigeria’s attractiveness as a business destination.
When done right, tax reform becomes the cornerstone of a favourable business climate. It ensures clarity, reduces the cost of compliance, and fosters investor confidence, precisely the ingredients needed to support EODB.
“A nation’s economic strength lies in its ability to support and grow its business ecosystem. The link between EODB and tax reform is not optional; it is essential.”
BEE versus EODB
While BEE encompasses all the systems, norms, infrastructure, and regulations influencing business operations, EODB focuses more specifically on how easy it is for a business to start, operate, and expand within a given jurisdiction. Both concepts are interlinked, and progress in one area naturally complements the other.
One laudable continental step in this direction is the African Continental Free Trade Area (AfCFTA), launched in January 2021. Although delayed by the COVID-19 pandemic, its operationalisation signals Africa’s collective readiness to dismantle trade barriers and improve the ease of doing business across borders.
Read also: Why Nigeria’s tax reforms matter to students and practitioners alike
Nigeria’s journey so far
Nigeria made a notable move in 2016 with the establishment of the Presidential Enabling Business Environment Council (PEBEC) under the office of the Vice President. Its mandate is clear: remove bottlenecks and improve investor perception of the Nigerian business climate.
Building on that foundation, the administration of President Bola Ahmed Tinubu GCFR has demonstrated a strong commitment to fiscal discipline and tax reform. The inauguration of the Presidential Fiscal Policy and Tax Reform Committee (PFPTRC), chaired by Mr Taiwo Oyedele FCTI, FCA, marked a pivotal moment. The committee recommended consolidating Nigeria’s over sixty types of taxes and levies into just eight, a move that, if implemented, will drastically enhance EODB by simplifying compliance and reducing arbitrary taxation.
The global context
According to the World Bank’s 2022 EODB rankings, countries like Singapore, New Zealand, and Denmark remain top performers. Unfortunately, no African country is listed among the top five. This is sobering and demands urgent and coordinated action across the continent.
In Nigeria, an ideal EODB environment must address six crucial dimensions, collectively known in management circles as the PESTLE index:
Political: A stable government that supports enterprise;
Economic: Predictable inflation, interest, and exchange rates;
Sociocultural: Values that support entrepreneurship;
Technological: Innovation-friendly policies;
Legal: Fair and enforceable tax and business laws;
Ecological: Commitment to sustainable environmental practices.
Benefits of EODB anchored on tax reform
If well articulated and implemented, EODB, powered by a sound tax reform agenda, can yield:
Job creation;
Simplified business regulation;
Improved governance and accountability;
Increased domestic and foreign investment.
A nation’s economic strength lies in its ability to support and grow its business ecosystem. The link between EODB and tax reform is not optional; it is essential. One cannot exist meaningfully without the other.
Read also: Stakeholders call for transparent tax reforms
Conclusion
On Wednesday, 7 May 2025, the Nigerian Senate passed two out of the four bills underpinning the 2023 tax reform agenda. Remarkably, the remaining two were passed the following day. These legislative milestones lay the groundwork for a friendlier business environment, especially for small and medium-sized enterprises, while creating an attractive climate for foreign direct investment (FDI).
It is therefore imperative that all stakeholders support this ongoing reform initiative. The benefits, in terms of economic growth, employment, and national development, far outweigh any temporary discomfort or adjustment it may require.
Dr Kingsley Ndubueze Ayozie FCTI, FCA, is a public affairs analyst and chartered accountant. He writes from Lagos.
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