THE LEAD STORY
Big Reform Energy: 50 Taxes Gone, Relief Incoming
Nigeria just fired the starter’s pistol on its most sweeping tax reset in decades. Beginning 1 January 2026, a 50-item menu of exemptions will wipe PAYE for minimum-wage earners, slash VAT on essential goods, and hand small businesses fresh breaks on capital gains and company income tax. The government is framing the package as the ultimate people-first play.
The Details
Low-income workers earning below the new threshold will see zero PAYE deducted, while SMEs gain exemptions on VAT, stamp duty, and capital gains. The Presidential Fiscal Policy & Tax Reforms Committee said the goal is to “put cash back in pockets” and spur job creation.
The Federal Inland Revenue Service (FIRS) is building the tech rails to make it happen. A transparent, e-invoicing-powered system will “strengthen compliance,” Guardian Nigeria reports. Expect streamlined withholding taxes and lighter VAT filings , but only if taxpayers upgrade their own systems.
Why It Matters
Tax professionals are cheering the clarity but flagging homework for clients. “Everyone loves an exemption until the audit,” one Lagos consultant quipped. States are also on alert; FIRS Chair Zacch Adedeji stressed in Nigerian Tribune that sub-nationals must align laws and give revenue agencies real autonomy or risk losing internally generated revenue (IGR) gains.
The reaction was swift across the aisle. Business groups welcomed the relief, yet oil marketers warned that separate moves, like a new 15 % import duty on petrol and diesel, could cancel out savings at the pump. More on that below.
AROUND THE TAX WORLD
• Watchdog in the Wings: President Tinubu appointed Dr. John Nwabueze as Nigeria’s first Tax Ombudsman, tasked with mediating taxpayer complaints and boosting transparency (Western Post).
• Pump Price Pressure: Oil marketers say the 15 % fuel import duty will jack up petrol costs, though FIRS insists the tariff nudges local refining and long-term price stability (Aljazirah News).
• Digital or Bust: FIRS’ coming e-invoicing and enhanced VAT reporting will be mandatory for all registered businesses next year, tightening real-time visibility into transactions (Guardian Nigeria).
• One-Stop Tax Shop: The new Nigeria Tax Administration Act, 2025 promises harmonised rules across federal, state and local tiers, cutting “multiple taxation headaches,” FIRS’ Adedeji told Nigerian Tribune.
BY THE NUMBERS
Prime Number: 50 , That’s the count of individual exemptions in the 2026 package, the largest single slate of reliefs in Nigeria’s modern tax history (BBC Pidgin).
LOOKING AHEAD
All eyes now turn to the Federal Executive Council, which must release detailed implementation regulations before year-end, while businesses scramble to update ERP systems for FIRS’ e-invoicing test run in Q2 2025.
Prepared by MyTax - mytax.com.ng