President Bola Tinubu on Thursday signed four landmark tax reform bills into law, insisting that his government has paved the way for a stronger and more dynamic economy for Nigeria.
A major aspects of the laws changes the name of the country’s top revenue agency, Federal Inland Service (FIRS), to Nigerian Revenue Service (NRS).
The new reform, which comes fully into effect on January, 1st 2026 in line with the country’s annual budget calendar, seeks to overhaul Nigeria’s tax system, favour the poor, and promote smallholder businesses.
Speaking during the signing ceremony, President Tinubu said “Any society, whatever its political system, is perpetually in transit between a past that bugs its memory and the vision of the future that inspires its evolution.
“Along this road, leadership is indispensable. Decisions must be made, risks must be taken, trust earned, promises kept, and a way forward is proposed. What we did a few minutes ago is a way forward for our country,” Tinubu stressed.
According to the President, “Leadership must help the people to take off, lead the way on every turn, twist and… we must help them to get to their destination. That is what we are doing here.
“Initially, it was difficult, but not all roads will be easy in the process of nation-building, even the block work
takes a binder and concrete cement to build the body. What you have provided is leadership and courage in the face of mounting disputes.
“Nowhere in the world that tax reform would be any easy, some tax bills that you might read (about) in your textbooks, might even sound like you’re reading in Japanese, very difficult, twisted equations, reverse ideologies, at the end of the day, what you must learn with is the hope to develop the people and show the right character towards the destination.
“We are in transit, we have changed rules, we have changed some of the misgivings, we have opened the door for new economy, business opportunity, we’re showing that Nigeria is truly ready and open for business. The question of our tax-to-GDP and all other formulas will be obsolete,” President Tinubu added.
Both chambers of the National Assembly recently passed the bills which had sparked wide controversy and debate, especially from the northern part of the country, over over inequality concerns.
Speaking to State House Correspondents at the presidential villa after the signing ceremony, the Chairman of the presidential committee on tax reform Taiwo Oyedele, said “These tax laws, are pro-poor. In particular, 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.”
He explained that “Small businesses, over 90% of small and micro nano businesses, will no longer have to worry about paying corporate income tax or charging VAT or even deducting withholding tax or paying PAYE for their employees.
“What this means is that there will be more money in the hands of the ordinary Nigerian to take care of their daily needs. In addition to that, these laws also provide what we call zero rates of VAT on essential consumption.”
Nigeria according to a 2023 report of the International Monetary Fund (IMF), has a tax-to-GDP ratio of 9.4%, the world’s lowest. The nation, therefore, depends heavily on borrowing to fund the budget, a condition, the government said will change for the better.
The four newly enacted laws, are the Nigeria Tax Bill, the Nigeria Tax Administration Bill, the Nigeria Revenue Service (Establishment) Bill, and the Joint Revenue Board (Establishment) Bill.
While the Nigeria Tax Bill (Ease of Doing Business) consolidates Nigeria’s fragmented tax statutes into a unified legal framework and seeks to reduce tax duplication, enhance clarity, and ease compliance for taxpayers, the Nigeria Tax Administration Bill provides a harmonized legal, and operational structure for tax administration at the federal, state, and local government levels, aiming to foster efficiency and uniformity in tax collection.
The Nigeria Revenue Service (Establishment) Bill repeals the existing Federal Inland Revenue Service (FIRS) Act, paving the way for the establishment of a new, performance-driven Nigeria Revenue Service (NRS) with expanded responsibilities, including non-tax revenue collection, and introduces strong mechanisms for accountability and transparency.
The Joint Revenue Board (Establishment) Bill sets up a national governance structure to coordinate tax efforts across all tiers of government, and introduces a Tax Appeal Tribunal and an Office of the Tax Ombudsman, enhancing taxpayer rights and dispute resolution mechanisms.
