Taiwo Oyedele, Chairman of the Presidential Fiscal Policy and Tax Reforms Committee, has announced 50 new tax reliefs and exemptions to ease the burden on low-income earners, average taxpayers, and small businesses. The reforms, which take effect January 1, 2026, mark a major step toward creating a fairer and simpler tax system.
Describing the package as “one of the most people-focused tax reforms in Nigeria’s history,” Oyedele said the initiative aims to reduce pressure on the poor, support small enterprises, and improve tax compliance and ease of doing business.
Key Highlights of the Tax Reliefs
1. Personal Income Tax (PAYE):
- Workers earning the national minimum wage or less are fully exempt.
- Annual income up to ₦1.2 million will be tax-free.
- Reduced PAYE rates for earners below ₦20 million annually.
2. Individual Reliefs:
- Deductions for pension, health, and housing fund contributions retained.
- Rent relief up to ₦500,000 (or 20 per cent of annual rent) allowed.
- Tax-free compensation for job loss up to ₦50 million.
3. Company Income Tax (CIT):
- Small firms with turnover under ₦100 million pay 0% CIT.
- Startups meeting government criteria qualify for exemptions.
- Agricultural businesses enjoy a five-year tax holiday.
4. Value Added Tax (VAT):
- No VAT on basic food, rent, books, health services, or medicines.
- Businesses earning under ₦100 million yearly are exempt from VAT.
- Agricultural inputs, baby products, EV parts, and humanitarian goods are also VAT-free.
5. Other Exemptions:
- No stamp duties on transfers below ₦10,000 or salary payments.
- Small firms exempt from withholding tax and the four per cent development levy.
Promoting Accurate Tax Education
Oyedele also announced an “Influencing for Good” campaign to encourage credible social media voices to educate the public on the new tax laws, countering misinformation.
He emphasised that “accurate information empowers citizens and builds trust,” calling for responsible communication around tax reforms.
The reforms follow President Bola Tinubu’s June 2025 approval of four landmark tax bills – the Nigeria Tax Bill, Tax Administration Bill, Nigeria Revenue Service (Establishment) Bill, and Joint Revenue Board Bill – forming the legal backbone of the new fiscal framework.
