President Bola Tinubu has signed into law four new tax reform bills that aim to overhaul Nigeria’s tax system, despite earlier pushback, particularly from some northern stakeholders who feared the changes might put their region at a disadvantage.
The brief signing ceremony, which was held at the Presidential Villa on Thursday, was attended by top government officials, including lawmakers, governors, ministers, and aides to the President.
The newly signed laws are: Nigeria Tax Act, Tax Administration Act, Nigeria Revenue Service (Establishment) Act and Joint Revenue Board (Establishment) Act.
These bills were passed by the National Assembly after months of consultation with various interest groups and are expected to take effect from January 1, 2026.
Speaking to journalists after the event, Chairman of the Federal Inland Revenue Service (FIRS), Zacch Adedeji, said the delayed start date would give stakeholders enough time to adjust.
“It takes time for participants, operators, and regulators to adapt. We now have six months for proper sensitisation and planning,” Adedeji said.
What the New Tax Laws Mean Under the new tax regime:
The Value Added Tax (VAT) rate remains at 7.5%, though its scope is expanded.
Key sectors such as food, healthcare, education, public transport, exports, and residential rent will remain zero-rated to cushion inflation.
VAT distribution has been restructured: 30% will now be shared based on consumption, 50% equally among states, and 20% based on population.
The Nigeria Tax Act simplifies the country’s tax system by consolidating over 50 small, overlapping taxes into a single framework—aimed at reducing the burden on businesses and improving compliance.
The Tax Administration Act sets uniform rules across all tiers of government for tax collection, reducing the chances of conflict and duplication.
The Nigeria Revenue Service Act officially replaces the Federal Inland Revenue Service with an independent agency to improve efficiency and transparency.
The Joint Revenue Board Act enhances coordination between federal, state, and local tax authorities. It also introduces a Tax Ombudsman and a Tax Appeal Tribunal to provide fair resolution of tax-related disputes.
The federal government says these reforms will improve the ease of doing business, raise more domestic revenue, and attract both local and foreign investment.
