The Chairman of the Presidential Fiscal Policy and Tax Reforms Committee, Taiwo Oyedele, has described the newly signed tax laws by President Bola Tinubu as “pro-poor,” saying they are designed to significantly ease the financial burden on low-income earners, small businesses, and everyday Nigerians.
Speaking to State House correspondents on Thursday shortly after the signing of four new tax reform bills into law, Oyedele emphasized that the reforms aim to leave “more money in the hands of ordinary Nigerians” by reducing tax obligations on essential sectors of the economy.
One of the key highlights of the reforms is the exemption of over one-third of workers in both the public and private sectors from paying Pay-As-You-Earn (PAYE) taxes. Oyedele stated:
> “More than 1/3 of workers in both the private and public sectors will now be exempted completely from PAYE. They will not have to pay personal income tax.”
In addition, he announced sweeping tax reliefs for small, micro, and nano businesses, noting that over 90 percent of these enterprises will no longer be required to pay corporate income tax, charge Value Added Tax (VAT), deduct withholding tax, or remit PAYE for their employees.
Oyedele also unveiled a new zero-rated VAT structure for essential goods and services. He explained that:
> “Any traces of VAT in food, education, and medical or healthcare services is now removed completely, so we should see prices of those items come down.”
Furthermore, he noted that key sectors where Nigerian households spend the bulk of their income—such as transportation, accommodation, and housing—have now been fully exempted from VAT.
> “These sectors collectively account for more than 80% of where Nigerians spend their money. That’s a huge relief for them,” Oyedele said.
Beyond tax relief, the reforms also include provisions aimed at improving tax collection efficiency and transparency. Oyedele explained that the new framework introduces mechanisms to ensure more transparent reporting of tax revenues and stronger links between revenue collection and public service delivery.
Also speaking, the Executive Chairman of the National Revenue Service (formerly known as the Federal Inland Revenue Service), Zacch Adedeji, announced that the tax reforms will officially take effect from January 1, 2026. This delay, he said, provides the government with sufficient time for planning, public education, and alignment with the national fiscal calendar.
> “When you have this kind of change, it’s not something you implement mid-year. Based on global best practices, the effective date is set for January 1, 2026, by the special grace of Almighty God,” Adedeji said.
He emphasized that the transition period would ensure smooth implementation across stakeholders—government agencies, regulators, and business operators alike—and ensure consistency with annual budget cycles.
However, concerns were raised by some industry players, including the CEO of ThinkBusiness Africa, who cautioned that the hike in sugar tax could negatively impact the beverage sector and potentially lead to job losses.
Despite this, the administration remains optimistic that the overall benefits of the tax reforms will outweigh the short-term adjustments and significantly improve economic inclusivity for Nigerians.
