Peter Obi, former governor of Anambra State and presidential candidate of the Labour Party in the 2023 elections, has called on the Federal Government to immediately suspend the implementation of Nigeria’s controversial new tax laws, warning that the current approach risks deepening public hardship and eroding trust in the state.

Obi’s intervention comes amid mounting criticism from businesses, professional bodies and civil society groups over sweeping changes to the country’s tax framework. The reforms, packaged in a recent Finance Act and related regulations, were intended to boost government revenue, broaden the tax base and modernise administration. Instead, they have triggered confusion, legal uncertainty and fears of overreach.

In a detailed statement, Obi argued that the tax changes are so fundamentally flawed that they cannot simply be adjusted on the fly. He cited an extensive review by global accounting and advisory firm KPMG, which reportedly identified 31 critical problem areas in the new regime. These ranged from basic drafting errors and ambiguous provisions to deeper policy contradictions and gaps in implementation.

For Obi, the fact that such a high number of serious issues emerged only after private technical engagements between the Federal Inland Revenue Service and KPMG is itself a red flag. He questioned why a law that affects every working Nigerian and every business in the country appears to have been designed and refined largely behind closed doors.

“If experts need closed-door discussions to make sense of our tax laws, what hope does the average Nigerian have of understanding the obligations being imposed on them?” he asked, framing the matter not just as a technical failure but as a democratic one.

Obi’s central argument is that taxation is not merely a fiscal tool but a core element of the social contract between citizens and the state. In his view, a tax system that is opaque, poorly communicated and disconnected from visible public benefits cannot command legitimacy, no matter how urgently the government needs revenue.

“Taxation goes beyond fiscal policy,” he stressed. “It represents a social contract between the government and its citizens. A social contract cannot be enforced if it is neither understood nor trusted.”

He contrasted Nigeria’s approach with global best practice, where governments typically embark on extensive consultations before overhauling tax laws. In many countries, he noted, draft tax proposals are subjected to months or even years of engagement with businesses, labour unions, professional associations and civil society organisations. Public hearings, explanatory documents and impact assessments are used to clarify not only what citizens will be required to pay, but also what they can expect in return.

“Globally, tax policies are justified through tangible benefits such as improved healthcare, quality education, job creation, infrastructure development and social safety nets. This is the true meaning of a social contract,” Obi said.

By contrast, he argued, Nigeria’s current tax drive appears to be driven primarily by the state’s hunger for revenue rather than a coherent vision of public value. “In Nigeria, the focus appears to be on how much more the government can extract, rather than what it is prepared to give in return. A tax system without visible public benefits is not reform; it is extortion.”

Obi’s comments tap into a broader public mood of frustration. Since the removal of fuel subsidies and the floating of the naira, Nigerians have faced a sharp rise in the cost of living. Food prices have surged, transport costs have climbed, and real incomes have been eroded by inflation and currency depreciation. Many households report cutting back on basic necessities, while small and medium-sized enterprises struggle with higher operating costs and weaker consumer demand.

Against this backdrop, Obi argued, the government’s aggressive push to enforce new and more complex tax rules is both mistimed and insensitive. He said citizens are still waiting for the promised compensatory measures that were supposed to accompany subsidy removal and other painful reforms, such as targeted cash transfers, improved public services and job-creating investments.

“Before addressing these challenges, we are being pushed into a sweeping new tax regime filled with inconsistencies and flagged with 31 major concerns by a leading global accounting firm. This is not responsible governance,” he said.

He also faulted the process leading up to the new laws, saying there was no meaningful public consultation or broad-based dialogue. Many Nigerians, he noted, first learned of the changes only when enforcement began or when professional bodies started raising alarms about their implications.

“The government has rushed into tax collection without building consensus and has imposed enforcement without clear explanations,” Obi said. “Citizens are confused about both the new regulations and the benefits attached to them.”

For Obi, the consequences of this approach go beyond technical non-compliance or administrative bottlenecks. He warned that when people do not understand or trust the tax system, they are more likely to see it as punitive and illegitimate, which in turn fuels evasion, resistance and a deeper breakdown in state–citizen relations.

“Without trust, taxation feels like punishment; without clarity, it breeds confusion; and without visible public value, it amounts to robbery,” he said, using stark language to underline the stakes.

Obi’s call is not simply for a pause but for a reset. He urged the Federal Government to suspend the enforcement of the new tax laws and return to the drawing board, this time with a transparent, inclusive and evidence-based process. That process, he suggested, should involve structured consultations with the private sector, labour, professional bodies, state governments and civil society, as well as clear communication to the public about the rationale, design and expected benefits of any new measures.

He also implied that tax reform cannot be isolated from broader governance reforms. For citizens to accept higher or more efficiently collected taxes, they must see credible efforts to cut waste, curb corruption, reduce the cost of governance and redirect public spending toward health, education, infrastructure and social protection.

Obi’s intervention adds to growing pressure on the administration to rethink its revenue strategy. Business groups have warned that poorly designed taxes could stifle investment, drive companies into the informal sector or out of the country, and ultimately undermine the very revenue goals the government is pursuing. Civil society organisations have raised concerns about the impact on low-income households and the risk of widening inequality.

In his closing remarks, Obi framed the issue as a test of leadership and vision. Nigeria, he said, cannot afford to place additional burdens on already struggling citizens without first rebuilding trust and demonstrating that government is prepared to share in the sacrifices it demands.

He called for “a government that listens, communicates clearly and prioritises national consensus as the only path to genuine reform, unity, growth and shared prosperity.”

Until then, Obi insists, the new tax laws should be paused, thoroughly reviewed and redesigned to reflect not just the state’s need for revenue, but the people’s right to clarity, fairness and tangible public benefit.