SENATOR NED NWOKO, SENATORS ARE PROSPERITY HEROES WITH FOUR MAJOR TAX REFORM SIGNED INTO LAW BY TINUBU: As Tax Relief, Exemption, Incentives On Certain Consumables & Services Trills Nigeria's Citizens
This Is A Friday, 27th June 2025, TERRAIN REPORTER ™ Exclusive News Story Report Culled By Justin Okpu, Special Assistant On Media To Distinguished Senator Ned Nwoko.
SENATOR NED NWOKO, SENATORS ARE PROSPERITY HEROES WITH FOUR MAJOR TAX REFORM SIGNED INTO LAW BY TINUBU: As Tax Relief, Exemption, Incentives On Certain Consumables & Services Trills Nigeria's Citizens
This Is A Friday, 27th June 2025, TERRAIN REPORTER™ Exclusive News Story Report Culled By Justin Okpu, Special Assistant On Media To Distinguished Senator Ned Nwoko.
Nigeria's President Bola Tinubu has signed, Senate's four tax bills into law, in a major tax reforms aimed at restructuring the country's tax system with, providing tax reliefs for low income earners and as well as help improve their priority spending, when these tax policies finally make ground fall.
Recalling, that these sets of new tax laws was very controversial, as it attracted high-tension, soaked debate between Distinguished Senator Ned Nwoko, his Distinguished colleagues, as other opposition group vehemently stood against the bills, when the these tax reform bill proposals were introduced on the floor of the senate chambers, at the National Assembly.
The Nigeria's President Tinubu reiterated that the new laws will simplify revenue collection, reduce the tax burden on some individuals and businesses, while also helping to raise much-needed government income revenue by making collection more efficient and would bring prosperity to Nigeria.
"The tax reforms will protect low-income households and support workers by expanding their disposable income," said President Tinubu in a statement to mark the second anniversary of his administration last month.
When detailing and analysing the four new tax reform laws below:
i) The Nigeria Tax Act, which merges various rules into a single, easier-to-understand code and eliminates more than 50 small, overlapping taxes. The presidency has said that reducing the number of taxes and eliminating duplication, will making doing business easier.
ii) The Tax Administration Act, which sets common rules for how taxes are collected across federal, state, and local governments
iii) The Nigeria Revenue Service Act, which replaces the Federal Inland Revenue Service (FIRS) with a new, independent agency - the Nigeria Revenue Service (NRS)
iv) The Joint Revenue Board Act, which improves co-ordination between levels of government and creates a Tax Ombudsman and Tax Appeal Tribunal to resolve disputes.
*"Together, these laws aim to create a fairer and more efficient tax system across the country,"* the Nigerian president explained.
Further more to buttress on incentive derivable from the new tax reform, as Tinubu continued ;
*"it is expected that low-income earners and small businesses owners, like petty traders in Lagos, other urban cities would benefit from the tax reforms through tax reliefs and exemptions."*
*"The tax reforms will protect low-income households and support workers by expanding their disposable income,"* said President Tinubu in a statement to mark the second anniversary of his administration last month.
The impact is expected to be significant especially for low-income earners, small businesses and informal traders.
For people earning up to 1m naira ($650; £470) a year, a rent relief of 200,000 naira ($130) will be applied, effectively reducing their taxable income to 800,000 naira ($520). This means they will no longer pay income tax, according to Andersen Nigeria, a tax and business advisory firm.
Sellers of essential goods and services such as food, healthcare, education, rent, power, and baby products will no longer have to charge a Value Added Tax (VAT), helping families better afford their basic needs.
Small businesses with annual turnover below 50m naira ($32,400) will no longer pay company income tax. They will also be allowed to file stress-free tax returns, without needing audited accounts.
Large businesses will benefit from reduced corporate tax rates, dropping from 30% to 27.5% in 2025 and 25% in subsequent years.
They will also now be able to claim tax credits for VAT paid on expenses and assets, meaning they can get back the 7.5% that would have been paid as VAT.
There are also tax incentives for charitable groups, co-operatives, educational and religious organisations, provided their earnings do not come from commercial activities.
Low-income households stand to benefit the most, as many will no longer have to pay income tax while also enjoying price relief on essentials. A typical family spending most of their income on rent, food and transport will see lower costs due to the VAT exemptions.
Small businesses should also see positive changes through more streamlined bureaucracy, which could help boost compliance and encourage informal traders to enter the tax system.
High-income individuals and luxury consumers may feel the pinch slightly, with higher VAT now expected on luxury goods and premium services, and capital gains tax imposed on large share sales.
The government argued that the old tax system was outdated, inefficient and unfairly harsh on the poor. Nigeria's tax-to-GDP ratio, a key indicator on tax collected do not reflect prosperity.
