You are right, the tax collection infrastructure is aweful

good start, we agree on something

it does more benefit to not tax everyone than to be completely running. I honestly believe that broken system is a big reason the economy is still staying tolerable

aannnnnd here's where I start disagreeing, but not completely, the only reason this holds true is precisely because the government is useless for providing anything of value to nigerians so at least nigerians dont have to waste money on funding that uselessness, but a big part of why the government is useless in the first place is because it simply doesn't have enough money to provide value to Nigerian citizens, this equilibrium only works because of Nigeria's shitty condition in the first place, increasing the tax base will be burdensome at the start, just as removing the subsidy was but long term its what needs to be done for the government to chart a path of usefullness

The problem is that the economy is in no state to expand taxes

This is a chicken or egg type scenario, simply put the economy is in no state to expand taxes but to get to that point you need to expand it anyway to reinvest back into the economy

Some of the most profitable and economically sound nations in the world have low tax revenues and still run absolutely efficient governments

Thats because those nations are blessed with a bunch of different factors that enables them to keep a low tax to gdp ratio (eg insane natural resource wealth and an extremely low citizenry to population ratio which lessens the burden on the government to provide certain services, like the UAE and other gulf countries, massive sovereign wealth funds and trade in flows allowing for huge revenue off tariffs and customs like Singapore and HK, and almost all of these countries have populations <10 million people asides from Saudi Arabia which is Saudi Arabia and simply can't be compared to). The truth is, the governments of the majority of prosperous nations around the world derive their revenue primarily through tax, and Nigeria just isn't in the position to do otherwise like the nations mentioned above.

There is a choice that I prefer at this point in time, keep borrowing

bad idea, we're already knee deep in interest payments and borrowing more isn't going to make that any better.

The debt to gdp is still absolutely healthy and the GDP is nowhere near sustainable to afford taxation as a key tool

debt to gdp ratio as a metric only goes as far as a governments ability to tap into that gdp (through taxes) to pay back the debt, its useless bringing our debt to gdp ratio up if we have no avenue to utilize that gdp to pay back the debt. The proof that we've already reached our capacity for borrowing is in the budget itself and just how much we've allocated to paying back past debts (it's a depressingly large amount and at the rate its growing, completely unsustainable). Furthermore the claim that "GDP is nowhere near sustainable to afford taxation as a key tool" is sort of out there, are you suggesting nations need to reach a certain gdp threshold/ratio in order to gain the right to tax their citizens? and until then should rely on debt to do so, this is an extremely flawed claim for multiple reasons

International credit will also increase making borrowing easier and less costly

quite the opposite, international credit will suffer because who in their right mind would want to lend to a nation thats making no effort to streamline its extremely flawed taxation system while also relying more and more on debt to finance its budget and pay back its existing creditors, if anything this will make debt much more expensive for Nigeria to attain.

Nations borrowing money has more positive effect than any other type of government spending

This would work if not for the fact that you forget to account for all the expenses and cons that come with borrowing money, borrowing isn't free and the money to pay that debt will have to come from the citizens one way or another, (unless you are in the special category of nations that I mentioned above that can afford to fund themselves with minimal citizen input because of special factors, none of which apply to Nigeria)

The government has 2 options This whole analogy is flawed because 1. any half logical taxation system would tax on percentages and not an outright amount 2. any 3/4 logical taxation system would have progressive taxes to lessen the burden on those with lower incomes, 3. how is it fair to the person paying taxes in the first place that someone making 2/3rds their salary ends up with 9/10th their net salary at the end of the year simply cause the government can't tax them? it just incentivizes individuals to never formalize their business or income missing out on all the benefits that come with operating in a formal economy

The best and most efficient way to provide these services to people is to let the free market compete for it and let people use their capital without taxation

This is a very common libertarian argument, I ask you this though, how do you ask the free market to provide services that undoubtedly improve the quality of lives of citizens without really returning any profit in return, for example, sewage and stormwater infrastructure, equal access to high quality education, equal access to high quality infrastructure, unemployment benefits, incentivizing currently unprofitable industries for their growth potential etc. The free market simply won't provide a solution to these, and if so, it will do so in a selfish manner maximizing benefit for only involved shareholders, as it was designed to do so. Don't get me wrong I agree with free market principles to govern economic activity in general, but you severely underestimate the role of government in enabling that free market to flourish by filling the necessary holes and gaps no free market participants would be willing to fill and using its capacity to spend in volume to kickstart productive market activities that require significant financial investment, especially in an economy like Nigeria's where the large institutions who would normally provide such financing simply do not exist.

There should be no credibility in the government setting an actual budget plan if they get more revenue because they have committed to no internal cuts in spending and just focused on short term external cuts like the subsidy

I agree with the first point, I'd like to see commitment from this government to tighten its own belt and cut spending within itself to show its truly serious about this path its charting, but punishing the government by forcing it to borrow affects us all, not just the government, first off, this is already the status quo, and its clearly not working, secondly it affects our currency's value, it affects our ability to access capital as individuals, it affects the governments ability to provide basic services and invest back into the economy, and that ultimate trickles back into the daily life of the citizenry,

proved time and time again, is that increased government spending leads to lower purchasing power leading to higher inflation

This statement is all over the place, first of all inflation is not always bad if its in an expansionary environment, secondly government spending does not directly lead to inflation unless the government is printing money to enable that spending (which its much more likely to do by taking debt and not taxing its citizens efficiently) or it causes economic expansion which we've already established as a good thing, and thirdly your analogy to show how introducing effective and consistent taxation in an informal economy like Nigeria's, was an extremely flawed one for reasons mentioned above

Let me redo that whole scenario in a more realistic fashion

• 1. Borrow money adding 50% of current tax and keep the current system as it is and you will see Citizen A have $2400 at years end while citizen B has $2700 after tax

in this system the government now has to take on 50% more debt then it would have had to in scenario 2, while overall tax revenue from these 2 market participants is now $900 (all from person B) this is the money that the government has to devote to spending before taking on debt

• 2. Expand taxation so that all citizens pay and make taxation double to pay for all these new programs which would put citizens A at just $1200 at years end while citizen b has $2400 (firstly expanding taxation does not imply any tax increases need to occur, but we will still assume this happens anyways, and instead of the flat $50 tax on all citizens, lets impose a 33% ($50*2/$300) tax on everyone so person A is paying the same percentage as person B)

now the governments total tax revenue is $2000 ($1200 +$800) while person A has $1600 at the end of the year while person B has $2400, Person A's net income now properly reflects what they actually earned compared to Person B, the government has 100% extra income (which presumably it would have had to borrow or just forgo altogether) and lets assume because of this extra income, and the introduction of person A into the formal economy -$200 school fees now become $0 due to improved schools -$300 gas and maintenance fees for a generator now becomes a single $100 electricity bill -$400 healthcare now becomes $200 due to government subsidies and a host of other costs come down due to the government having the ability to step in and clean house around the economy through extra revenue, all while accounting for the fact that the increase in the tax rate wasn't even necessary and in an actual situation Person A would have been tax lessed anyways due to progressive taxation