The Lagos State government has launched an ambitious initiative to generate N200 billion annually by expanding its income tax base to include remote workers and utilizing digital solutions for enhanced revenue collection. This plan is part of a broader strategy to raise N5 trillion in internally generated revenue (IGR) from four major sectors, as detailed in the synopsis document for the upcoming EKO Revenue Plus Summit. Scheduled for September 25th and 26th, 2024, the summit will explore the theme “Unlocking New Revenue Streams for Lagos State.”

A key component of this plan is the introduction of the Resident Global Digital Citizen Tax Management System, which will target remote workers, foreign firms, and digital influencers. This system will involve the accreditation and licensing of digital economy operators, supported by a robust platform that includes an e-Portal, Marketplace, and Recovery Platform. The initiative’s approximated spending plan is N250 million, covering portal construction, information mining, partnerships, stakeholder engagements, and communications.. The state aims to generate N200 billion annually from about two million people in this area.

In addition to targeting remote workers, Lagos State plans to generate revenue through several other digital economy initiatives. These include the digitalization of government services and data monetization, the establishment of a fintech hub, the creation of a software development center, and the launch of a digital economy acceleration hub. Each of these projects has its own budget and projected revenue targets, collectively contributing billions of naira annually.

The digitalization of government services and data monetization is expected to cost N500 million and potentially generate N50 billion per year. The fintech hub, with a budget of N5 billion, aims to support digital payments, mobile money, lending, and crowdfunding, with an estimated annual revenue of N100 billion. The software development center, focused on creating solutions for finance, SMEs, and retail sectors, has a budget of N500 million and aims to generate N150 billion annually. The digital economy acceleration hub will involve selecting and developing 100 innovative startups through a hackathon and subsequent support, with an estimated cost of N12 billion and expected revenue of N100 billion each year from profit-sharing designs.

Additional projects include the creation of a state-owned advertisement network, the implementation of a blockchain and tokenization agenda, and collaboration with the Federal Government on Digital Service Tax (DST). Each of these initiatives has its own budget and revenue projections, further contributing to Lagos State’s financial growth.

With the EKO Revenue Plus Summit approaching, Lagos State aims to achieve an incremental IGR of approximately N2.73 trillion. The state has identified four core sub-sectors of its economy as key areas for additional revenue generation: the Property Industry, Digital Economy, Informal Sector, and Circular Economy. The Property Industry alone is expected to generate N1.5 trillion, while the Digital Economy is projected to add N750 billion. The Casual Sector is anticipated to generate N460 billion, and the Circular Economy is anticipated to contribute N20 billion.

Governor Babajide Sanwo-Olu’s administration is committed to leveraging technology, strengthening tax administration, expanding the tax base, and exploring new revenue streams to optimize existing processes and significantly boost the state’s IGR. The Lagos New Money Initiatives aim to build upon the existing IGR framework target of N1.25 trillion, thus creating a substantial financial foundation for the state.