By Karen Ibrahim
In Sokoto State, as in several other states, the revenue challenge has never been simply about how much money is collected, but about how much of what is collected actually reaches government coffers. Prior to the recent reforms, internal audits and administrative reviews revealed that between 30 and 40 percent of revenues in some collection lines failed to be fully remitted, lost to leakages, informal intermediaries, and weak oversight. These losses translated directly into underfunded schools, strained healthcare facilities, delayed infrastructure projects, and a widening trust deficit between government and citizens. Revenue, in this context, became a mirror of governance failure.
When Governor Ahmed Aliyu assumed office, he inherited not only a fiscally constrained state but a revenue collection system structurally vulnerable to diversion and loss. Informal, cash-based collection channels thrived with little oversight, non-remittance of collected funds was rarely sanctioned, and fragmented accounts made it difficult to reconcile what was due to government with what actually reached its coffers. In such an environment, leakages became systemic rather than incidental.
Public scepticism was therefore understandable. Many citizens doubted that their taxes and levies would translate into tangible public value, having seen little correlation between compliance and improved service delivery. For the governor, closing this credibility gap was as urgent as ensuring that revenues already collected were not “lost in transit.” This decision to prioritise system integrity over increased taxation marked a critical shift in approach and has gone a long way in improving compliance and boosting revenue collection, largely through efficiency gains rather than imposing additional burdens on citizens.
Governor Aliyu’s response marked a deliberate shift away from the business-as-usual approach to revenue challenges. Rather than defaulting to higher taxes or aggressive enforcement, his administration focused first on blocking leakages, eliminating middlemen, and enforcing transparent remittance mechanisms. According to government disclosures, monthly inflows from existing revenue sources improved without increases in rates or the introduction of new taxes, indicating that the gains were driven largely by efficiency and discipline rather than additional burdens. This reform-driven approach reframes revenue generation as an institutional challenge rooted in governance, not merely as a fiscal shortfall.
Sokoto State’s revenue problem is not unique within Nigeria’s federal structure, but its impact has been particularly acute. Like many subnational governments, the state had long depended heavily on federal allocations, masking deep structural weaknesses in internally generated revenue. Over time, non-remittance, informal collection practices, and weak oversight undermined fiscal planning and constrained development outcomes. Governor Aliyu’s administration entered office amid high public expectations but also deep scepticism about whether meaningful reform was possible—questions that the reforms have begun to answer convincingly.
A clear identification of the challenge—leakage—formed the foundation of the reform process. In many cases, funds generated at collection points never reached government accounts in full. Informal and unregulated agents inserted themselves into the process, while poor record-keeping made it difficult to track discrepancies. These practices not only weakened public finances but eroded public trust, reducing voluntary compliance and reinforcing a cycle of inefficiency.
To address this, the administration prioritised sanitising the revenue collection system before demanding citizens pay additional taxes. A key reform mechanism was the strengthened enforcement of the Treasury Single Account (TSA) across ministries, departments, and agencies, ensuring that revenues are paid directly into the government account rather than retained. This step alone has significantly reduced opportunities for diversion and delayed remittance.
The administration has also embraced digital technologies to reduce leakages and improve compliance. Sokoto’s Internal Revenue Service now operates an integrated tax administration portal for online payments (itas.irs.sk.gov.ng), shifting a growing share of tax transactions away from cash-based systems and human intermediaries. While comprehensive public figures on the exact share of electronic payments are still emerging, revenue officials report that digitalisation has contributed to at least a 10% growth in tax receipts since automation efforts were expanded.
This shift to bank-linked and online payment channels has reduced physical cash handling—a key source of leakages—and improved taxpayer convenience and accountability. The recent establishment of the Sokoto State Information and Communication Technology Development Agency (SICTDA) provides a further institutional anchor for e-governance and digital public infrastructure that can support expanded digital tax platforms and other services.
In addition, the government moved to eliminate informal revenue collectors and third-party intermediaries, proven sources of leakage, replacing them with bank-linked and electronic payment channels. These measures were complemented with the introduction of a revenue monitoring and reconciliation framework, enabling routine comparisons between expected collections and actual remittances and allowing discrepancies to be identified and addressed early.
Transparency and accountability are the central pillars of this reform agenda. Improved documentation and reporting have strengthened revenue collection while signalling to the public that their taxes are no longer disappearing into private accounts. Trust, after all, is the currency of effective taxation: when citizens believe their contributions are well managed, compliance becomes a civic duty rather than a coerced obligation.
Institutional reform has also featured prominently in Governor Aliyu’s strategy. Revenue generation is not the responsibility of one individual but of agencies and systems that must function effectively. Revenue-generating agencies now operate under clearer mandates, performance benchmarks, and reporting obligations, with senior officials held accountable for remittance failures. Capacity-building initiatives for revenue officers have reinforced standards of compliance, record-keeping, and ethical conduct, reframing revenue collection as a public trust.
Equally important is the administration’s emphasis on linking improved revenue performance to visible development outcomes. Revenue collection is easier to defend when citizens can see tangible benefits in education, healthcare, roads, and social services. This linkage has reinforced the social contract between government and the governed and answers a fundamental question in public finance: what do citizens receive in return for their taxes?
The link between revenue and results is no longer theoretical in Sokoto State. For instance, the state’s internally generated revenue (IGR) grew by about 21.4% in 2024, rising from roughly N18.16 billion in 2023 to more than N22.05 billion, and monthly collections under Governor Aliyu’s reforms have climbed from about N2.0 billion to N3.8 billion within a year. These revenue improvements have helped fund visible investments such as road construction and healthcare facility upgrades across several local government areas, demonstrating that when the government collects more efficiently, the people gain.
A critical argument underpinning these reforms is the relationship between transparency and taxation. When systems are opaque, compliance declines and enforcement becomes costly and confrontational. By fixing the system first—plugging leakages, ensuring accountability, and strengthening institutions—**Governor Aliyu’s approach is both ethical and strategic. Asking citizens to pay more without demonstrating integrity in management would be highly counterproductive.
Sokoto State’s experience also carries broader implications for Nigeria’s fiscal debates. The Sultan of Sokoto has repeatedly argued that Nigeria’s core challenge is not the absence of resources but leadership and resource management. This perspective resonates strongly with the reforms underway in Sokoto State. In an era of declining oil revenues and rising expenditure pressures, Sokoto’s example of disciplined fiscal governance is a step in the right direction.
Nonetheless, constructive critique remains necessary. For reforms to endure, they must be institutionalised through laws, regulations, and standard operating procedures, not reliant solely on executive directives. Expanding digital revenue platforms, conducting regular independent audits, and publishing citizen-friendly revenue performance reports would further deepen transparency and accountability. Legislative oversight is also essential to ensure progress.
Citizen engagement must accompany these measures. Revenue collection thrives on dialogue. Educating citizens about how revenues are collected and utilised can transform public perception from suspicion to partnership and strengthen voluntary compliance.
In conclusion, Sokoto State’s revenue challenges underscore a broader truth: fiscal problems are ultimately governance problems. They are solved not through heavier taxation alone, but through transparent systems, accountable leadership, and strong institutions. Governor Ahmed Aliyu’s approach—focused on sanitising the revenue system, strengthening institutions, and rebuilding trust—shows promise. If sustained and institutionalised, these reforms could stabilise Sokoto’s finances and offer a replicable model for other subnational governments across Nigeria.
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