Dr. Ernest Abegbe, an economist and tax practitioner in Nigeria, has called on the nation's tax authorities to consider implementing a temporary waiver on the Late Returns Penalty and the accrued interest on unpaid taxes. This recommendation is seen as a means to enhance voluntary compliance among businesses, especially those struggling with outstanding tax filings. Abegbe highlighted that the waivers would complement ongoing reforms aimed at improving tax administration and expanding the national tax base.

In his remarks during an interview, Abegbe emphasized the significant burden that accumulated penalties and interest have placed on companies attempting to regularize their tax status, particularly those using automated tax systems which can inadvertently lead to high penalties. He stated that while many businesses are keen to meet their tax obligations, the financial strain caused by these penalties often deters them from coming forward to settle their debts. The economist believes that alleviating these penalties could reset the compliance atmosphere, thereby encouraging more businesses to adhere to tax regulations.

These proposed reforms align with Section 66 of the Nigerian Tax Administration Act 2025, which is focused on optimizing tax compliance and broadening the tax base. Abegbe's arguments highlight the importance of creating an equitable tax environment that allows companies to thrive while complying with legal obligations. By removing the penalties temporarily, he argues that it would represent a forward-thinking approach designed to encourage long-term voluntary compliance among firms in the Nigerian economy.