Nigeria Launches Electronic Fiscal System To Revolutionize Tax Administration.
The Federal Government of Nigeria has officially launched the Electronic Fiscal System (EFS), a groundbreaking initiative aimed at modernizing the country’s tax administration, curbing tax evasion, and enhancing transparency in revenue collection. The Federal Inland Revenue Service (FIRS) announced that the system, featuring an electronic invoicing platform known as the Merchant-Buyer Model (MBM), went live on August 1, 2025, following a successful pilot phase that began in November 2024.
The EFS targets large companies with annual turnovers of ₦5 billion and above in its initial phase, providing real-time visibility into commercial transactions to ensure invoice authenticity, accuracy, and completeness. According to FIRS Chairman Dr. Zacch Adedeji, the platform is designed to make tax compliance faster, easier, and more transparent. “This is a strategic step to improve tax transparency, reduce leakages, and build a modern, efficient tax administration in Nigeria,” he stated.
Early Success and Industry Adoption
Within two weeks of the system’s launch, approximately 1,000 companies—representing 20% of the over 5,000 eligible firms—have integrated with the FIRS MBM platform. MTN Nigeria became the first taxpayer to transmit live electronic invoices, marking a significant milestone in the e-invoicing regime. Huawei Nigeria and IHS Nigeria have also completed test transmissions and are expected to go live soon.
To accommodate operational challenges faced by some companies, the FIRS extended the onboarding deadline from August 1 to November 1, 2025, encouraging voluntary compliance. The agency has partnered with the National Information Technology Development Agency (NITDA) to incorporate service providers as system integrators and access point providers, facilitating seamless onboarding and invoice transmission for taxpayers.
A Broader Reform Agenda
The EFS rollout aligns with President Bola Ahmed Tinubu’s comprehensive fiscal reform agenda, which seeks to tighten Nigeria’s tax net and address issues like multiple taxation and revenue leakages. The Presidential Committee on Fiscal Policy and Tax Reforms, chaired by Taiwo Oyedele, is driving these efforts. Starting January 2026, four new laws—including the Nigeria Tax Act and the Tax Administration Act—will introduce digital registration, stricter reporting requirements, and mandatory disclosure of beneficial ownership to curb tax avoidance schemes.
The system is being rolled out in phases, with medium-sized and emerging businesses set to join after the large taxpayer category. The FIRS has committed to ongoing stakeholder engagement through webinars, workshops, and town hall meetings to ensure a smooth transition.
Global Standards and Economic Impact
The EFS aligns with global best practices, supporting Nigeria’s broader objectives of enhancing revenue assurance and harmonizing revenue reporting under the Nigeria Revenue Services Reform Act. By providing real-time tracking of taxable transactions, the system is expected to prevent revenue leakages, promote transparency, and boost compliance across sectors.
Posts on X reflect positive sentiment toward the initiative, with users noting its potential to modernize tax administration and curb evasion. The FIRS has also introduced a Transaction Monitoring System to track VAT-eligible electronic transactions, requiring banks, fintechs, and payment providers to connect via API.
As Nigeria continues its digital transformation journey, the EFS marks a significant step toward a more efficient and transparent tax system, positioning the country as a leader in modern fiscal administration in Africa.
For more information, taxpayers can contact their assigned FIRS liaison officers or visit the official FIRS website.
