The Federal Government has opened a six-week review of Nigeria's 2025 tax laws, with Finance Minister Taiwo Oyedele inaugurating the Technical Subcommittee on Fiscal Policy and Tax Reforms in Abuja on Thursday. The exercise follows complaints from businesses, investors and stakeholders over VAT thresholds, withholding tax rules, capital gains tax treatment and multiple taxation.
The four major tax laws, the Nigeria Tax Act 2025, Nigeria Tax Administration Act 2025, Nigeria Revenue Service (Establishment) Act 2025 and Joint Revenue Board (Establishment) Act 2025, took effect on January 1, 2026. Months into implementation, the government says problems surfaced when the laws met real business conditions.
Oyedele, who chairs the Presidential Fiscal Policy and Tax Reforms Committee, said the government received 134 submissions from Nigerians across different geopolitical zones after requesting public feedback. The review is not meant to cancel the reforms, he said, but to fix how they operate.
"The real test begins when the law meets the economy, as businesses interpret it, administrators implement it, investors respond to it, and citizens experience it. Implementation inevitably reveals areas requiring clarification, refinement or further reform," the minister said.
Stakeholder proposals covered reducing compliance stress, protecting small businesses and improving investment conditions. Businesses asked for clearer VAT rules, a review of withholding tax requirements, better capital gains tax rules and coordination among revenue authorities to end multiple taxation.
Other suggestions included more digital systems and data sharing so taxpayers are not repeatedly asked for information already held by government agencies. Stronger taxpayer rights, quicker tax refunds and policies to encourage investment in mining, renewable energy, healthcare and capital markets were also raised.
Oyedele said tax policy should be judged on fairness, efficiency and competitiveness, not just revenue generation. "Every tax reform produces winners and losers; the question is whether a policy is fair, efficient and competitive, not whether it is popular with everyone," he said.
He warned that complicated rules add their own cost. "Complexity is itself a tax; it raises compliance costs and creates room for discretion and arbitrage. Where two approaches achieve the same outcome, choose the simpler one."
Withholding tax is a central focus. Oyedele said it should not become an extra financial burden on companies, explaining that businesses already face high borrowing costs and holding back their funds could slow expansion.
Co-chair of the committee Albert Folorunsho made the same point during the inauguration. "In a country where the cost of capital is very high, if you withhold the funds that businesses should use for expansion for even one year, it comes at a huge cost," he said.
The committee will prepare recommendations for the Finance Bill 2027 and review existing regulations, including the Deduction of Tax at Source Regulations 2024 and the Companies Income Tax (Significant Economic Presence) Order 2020.
Oyedele said the Finance Bill 2027 should not be treated as routine annual legislation. "Our task is not to rewrite the 2025 reforms, but to preserve their fundamental principles while learning from implementation and responding to new economic realities."
The committee draws members from the Nigeria Revenue Service, Central Bank of Nigeria, Nigeria Customs Service, Debt Management Office, Budget Office of the Federation, Manufacturers Association of Nigeria, Nigerian Economic Summit Group, tax bodies and major accounting firms.
According to Pulse.ng.
