Nigeria’s President Bola Tinubu has confirmed that the country’s new tax laws will take effect on January

Nigeria’s President Bola Tinubu has confirmed that the country’s new tax laws will take effect on January

Nigeria’s President Bola Tinubu has confirmed that the country’s new tax laws will take effect on January 1, 2026, as planned, despite calls for suspension or delay. The tax reforms aim to rebuild Nigeria’s fiscal framework, promote fairness, and strengthen the social contract between the government and citizens. Tinubu emphasized that the reforms are not intended to increase taxes but rather to deliver a structural reset that promotes fairness, harmonization, competitiveness, and dignity in the tax system .

The new tax laws include changes to income tax, value-added tax (VAT), and digital assets taxation. Some key features of the reforms include .
Income Tax: Individuals earning N800,000 or less per year will not pay taxes, while small companies with annual earnings of N50 million or less and fixed assets valued at N250 million or less will be exempt from company income tax and capital gains tax.
VAT: The VAT rate remains at 7.5%, but the sharing formula has been revised to 10% for the federal government, 55% for states, and 35% for local governments.
Digital assets are now taxable, and foreign companies earning income in Nigeria will pay a minimum tax based on a portion of their earnings before interest and tax.

Tinubu urged stakeholders to support the implementation phase, noting that the process has moved beyond policy design. He also acknowledged ongoing public discourse over alleged alterations to some provisions of the tax laws but insisted that no substantial issue had been established to warrant disrupting the reform process .

– Nearly 98% of Nigerian workers and 97% of small businesses will either be fully exempt from taxes or see their liabilities drastically reduced.
– The reforms aim to promote economic growth, inclusivity, and prosperity for citizens.
– The tax system will be more efficient, with improved services for taxpayers and a better working environment for staff .

The implementation of the new tax laws will proceed as planned, with the government working closely with the National Assembly to resolve any issues that may arise. The success of the reforms will depend on effective implementation and the cooperation of stakeholders .