Nigeria should create a central tax agency, known as the Nigerian Revenue Service, eliminating over 100 different collection agencies at the federal, state and municipal levels, an advisory panel has recommended.

President Bola Tinubu appointed Taiwo Oyedele, a partner at PwC Nigeria, to head the Presidential Fiscal Policy and Tax Reforms Committee to harmonise taxes and simplify the national tax system, removing taxes that impede businesses.

Nigeria's tax revenue as a percentage of GDP has slipped to the current 10.86% from around 19.98% in 2011, according to the government statistics office. It is much below the African average of 15.6%.

Oyedele's team is tasked with helping to raise the tax revenue as a percentage of GDP to 18% within the next three years.

Apart from cutting over 60 taxes to only 8, the committee has also recommended implementing zero-based budgeting, and introducing long-term appropriation, in its report announced to the media on Thursday.

The budget must be restructured to classify items under infrastructure, human capital investment, personnel cost and productivity, administrative overheads, debt service and sinking funds.

Nigeria has relied on debt to finance public spending which limits its ability to fund roads, schools and other public infrastructure on account of rising service costs. It will spend 30% of its 2024 budget on debt servicing.

The fiscal advisory body has also called for the government to tackle systemic corruption, prioritise spending on basic needs to address poverty, restrict borrowing, and enhance public procurement effectiveness.

Some of the initial recommendations implemented include removing value added tax on diesel and eliminating multiple taxes in the informal sector.

(Reporting by Isaac Anyaogu; Editing by Sriraj Kalluvila)