The Federal Government has reaffirmed that Nigeria’s far-reaching tax reforms will take effect on January 1, 2026, dismissing calls for further delays and insisting that the new tax regime is designed to ease the burden on ordinary Nigerians and small businesses.
The confirmation followed a high-level meeting between President Bola Ahmed Tinubu and members of the Presidential Committee on Fiscal Policy and Tax Reforms on Friday.
Speaking after the meeting, the committee’s chairman said the final implementation phase of the reforms — covering the Nigeria Tax Act and the Nigeria Tax Administration Act — remains firmly on schedule.
The confirmation was conveyed in a video message shared via the President’s media channels after the meeting, which was held in Abuja.
According to the committee chairman, the administration is pressing ahead with the reforms because of their “pro-people” orientation, arguing that the new laws are structured to shift the tax burden away from low-income earners and small enterprises.
He said government projections show that about 98 per cent of Nigerian workers and 97 per cent of small businesses will either be fully exempt from taxes or experience significant reductions in their tax obligations once the reforms take effect.
“The plans to commence the remaining two tax laws on January 1, 2026, will proceed as scheduled,” he said, noting that the reforms were deliberately crafted to provide relief for the majority of Nigerians.
Under the new framework, the bottom 90 per cent of salaried workers are expected to either be exempt from Pay-As-You-Earn (PAYE) tax or face substantially reduced deductions.
In addition, 97 per cent of small businesses nationwide will be exempt from three major taxes — Corporate Income Tax, Value Added Tax (VAT), and Withholding Tax — a move the government says is aimed at boosting entrepreneurship, job creation and economic growth.
Large corporations, while remaining within the tax net, are expected to benefit from reduced tax rates under the revised system.
The committee chairman said the overarching goal of the reforms is to stimulate economic activity, promote inclusivity and improve compliance by simplifying Nigeria’s tax structure.
“These reforms are designed to deliver direct economic relief to Nigerians and create a more growth-friendly tax environment,” he said, adding that the new regime is expected to encourage productivity while reducing the cost of doing business.
He noted that the reforms followed an extensive legislative process, with the tax bills undergoing about nine months of review at the National Assembly between October 2024 and June 2025 before receiving presidential assent.
Following approval, the committee has spent the last six months preparing for implementation, focusing on system upgrades, capacity building and public sensitisation.
“Our preparations started immediately after assent,” he said, explaining that government agencies have been working to ensure that administrative structures, digital systems and enforcement mechanisms are ready ahead of the January 2026 launch.
While expressing confidence in the rollout timeline, the committee chairman acknowledged that tax reforms of this scale require constant evaluation and adjustment.
He said government remains open to refining the framework as implementation begins, stressing that the objective is to build a fair, efficient and sustainable tax system.
“We are encouraged by the progress made so far and remain committed to continuous improvement as we move towards full implementation,” he added.
The confirmation solidifies the roadmap for one of the Tinubu administration’s most ambitious economic policies, as businesses, workers and investors now await the full impact of the new tax regime from 2026.