Federal Government Phases Out Remita, Introduces TMRAS for Enhanced Revenue Collection

The Federal Government of Nigeria (FG) unveiled the Treasury Management & Revenue Assurance System (TMRAS), a groundbreaking payment platform designed to replace the existing Remita system and revolutionize revenue collection across the country. This strategic shift, announced in a memo from the Office of the Accountant General of the Federation (OAGF) dated February 28, 2025, marks an important aspect in Nigeria’s quest to enhance transparency, efficiency, and accountability in public financial management. By leveraging advanced technology, TMRAS aims to address longstanding challenges in revenue collection, boost non-oil revenues, and strengthen Nigeria’s economic stability, crucial steps for a nation heavily reliant on oil exports and facing fiscal pressures.

The Need for Change in Revenue Collection

Nigeria’s economy, the largest in Africa by nominal GDP, has long grappled with inefficiencies in revenue collection, particularly outside the oil sector, which accounts for 90% of foreign exchange receipts Historically, the country has struggled with low tax-to-GDP ratios, reliance on manual processes, and revenue leakages, as noted in the World Bank’s 2023 Nigeria Economic Update. Agriculture, which employs over 70% of the population, and non-oil sectors contribute significantly less than their potential due to inefficiencies in collection systems (“Economy of Nigeria – Wikipedia”). Remita, introduced in 2015, improved revenue collection but revealed gaps in capturing and monitoring government revenues, prompting the need for a more robust solution.

“Remita has served us well, but we’ve identified critical gaps in its ability to fully capture and track government revenues,” a senior official at the Ministry of Finance told Naija247news on condition of anonymity. “TMRAS represents a significant upgrade in our revenue management capabilities. It will ensure that every kobo due to the government is collected and accounted for.”

“This initiative aligns with our commitment to improve budget performance and revenue assurance, ensuring Nigeria’s fiscal stability in a challenging global environment,” Wale Edun, Coordinating Minister of Finance and National Economy said to Punch Newspapers.

How TMRAS Enhances Revenue Collection

TMRAS, launched in two phases with the first phase going live on March 4, 2025, introduces several innovative features to transform Nigeria’s revenue collection landscape:

Real-Time Tracking and Automation:

TMRAS integrates advanced technologies, including artificial intelligence and blockchain, to provide real-time data on government revenues, automate tax deductions (e.g., VAT, Withholding Tax, and Stamp Duty), and minimize manual processes. This reduces opportunities for corruption and ensures accurate accounting, as stated in the Punch article (web:1). “The system will generate bank statements, track balances, and provide detailed reports, enhancing accountability across all MDAs,” said the OAGF memo.

Seamless Integration with Government Platforms:

TMRAS connects with existing systems like the Government Integrated Financial Management Information System (GIFMIS) and the Treasury Single Account (TSA), ensuring a unified approach to financial management. This integration, as noted by Naija247news, facilitates seamless coordination between the Central Bank of Nigeria (CBN), MDAs, and Payment Solution Service Providers (PSSPs), ensuring only CBN-licensed PSSPs approved by the OAGF can collect revenue.

Enhanced Revenue Assurance:

The system automatically deducts 50% of Internally Generated Revenue (IGR) from federal agencies and parastatals, splitting it between the federal government’s account and the MDA’s dedicated account. This mechanism, detailed in the OAGF memo, ensures transparency and prevents revenue diversion, a persistent challenge in Nigeria’s fiscal system.

Phased Rollout for Smooth Transition:

To avoid disruptions, TMRAS will run concurrently with Remita from March 4 to May 4, 2025, before becoming the exclusive platform. “This phased approach ensures that MDAs can adapt without compromising revenue flows,” a senior official at the Ministry of Finance told Punch Newspapers (web:1). By May 5, 2025, all payments will be processed exclusively through TMRAS, targeting a more efficient and accountable system.

Impact on Revenue Collection Across Nigeria

TMRAS is developed to significantly improve revenue collection by addressing key challenges identified in Nigeria’s fiscal landscape:

Increased Transparency and Accountability: By automating processes and providing real-time data, TMRAS reduces opportunities for revenue leakage and corruption, which cost Nigeria billions annually, according to the International Monetary Fund (IMF, 2024 Nigeria Article IV Consultation). “We are moving toward a new era of transparency and efficiency in Nigeria’s public financial management,” the Ministry of Finance official added.

Boosting Non-Oil Revenues: Nigeria’s reliance on oil, which constitutes only 9% of GDP but 90% of export earnings, has left the economy vulnerable to global oil price fluctuations. TMRAS aims to enhance collections from non-oil sectors like agriculture, manufacturing, and services, which have struggled due to low productivity and inefficient tax systems. The World Bank estimates that improving tax administration could increase Nigeria’s tax-to-GDP ratio from 6% to 15%, a goal TMRAS supports.

Supporting Economic Diversification: With oil revenues contributing two-thirds of state revenues but only 9% of GDP, Nigeria’s re-emergent manufacturing sector and agricultural exports to West Africa require robust revenue systems. TMRAS ensures that funds from these sectors are accurately collected and allocated, supporting the National Economic Empowerment Development Strategy (NEEDS) goal of reducing inflation and boosting economic growth.

Reducing Dependency on Manual Processes: Nigeria’s agricultural sector, which relies on antiquated methods, and its mining industry, contributing just 0.3% of GDP, have been hampered by inefficiencies. TMRAS’s automation eliminates manual bottlenecks, ensuring timely and accurate revenue flows from diverse sectors, including remittances, which surpassed tax revenues in 2015.

The introduction of TMRAS is part of a broader effort to modernize Nigeria’s public financial management, as evidenced by initiatives like the TSA and GIFMIS. By improving revenue collection, TMRAS supports the government’s goal of achieving fiscal sustainability, reducing Nigeria’s debt-to-GDP ratio (36.63% in 2021), and funding critical infrastructure projects. It also positions Nigeria as a leader in technological innovation on the African continent, potentially inspiring similar reforms in neighboring countries facing revenue challenges.

However, the success of TMRAS hinges on effective implementation, stakeholder cooperation, and public trust. Challenges like resistance from MDAs, technical glitches, or insufficient training could hinder its impact. “The anticipation is high, but the system’s success will depend on effective implementation and the cooperation of all stakeholders,”

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