The International Monetary Fund has asked government to implement a reform to phase out tax holidays and increase taxes imposed on tobacco and alcohol.

The IMF resident representative in Nigeria, Amine Mati, said this at a forum in Lagos at the weekend.

Mati is also seeking the reduction of interest payments on borrowed funds to about 30 per cent of the country’s revenue, and a lower tax rate to increase compliance from companies and individuals.

Meanwhile, the IMF has said that economic growth in sub-Saharan Africa is expected to rise to 3.4 per cent in 2018 from 2.6 per cent in 2017.

The IMF is concerned that most countries now borrow from local banks, which could destabilise the domestic financial sector and fuel inflation.