Amanze Chinonye
The Executive Chairman of the Nigeria Revenue Service (NRS), Dr. Zacchaeus Adedeji, has assured Nigerians that the country’s new tax reforms, effective January 1, 2026, are designed to protect low-income earners while broadening the tax base.
Addressing concerns that the reforms might allow tax officials to scrutinize personal bank accounts, Adedeji said, “No tax official will pry into your bank account to see who you transferred money to. Narratives about bank transfers are misinformation; there is nothing of the sort. We can only tax, return, profit, and consumption.”
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According to verified sources, the reforms exempt more than 95 percent of low-income Nigerians from new tax burdens. A key feature is the removal of Value Added Tax (VAT) on basic food items and essential transportation, which constitute the bulk of expenditure for poor households. Experts note that about 90 percent of the disposable income of low-income households is spent on food, making the VAT exemption a direct benefit for the poor.
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The tax laws were signed into law by President Tinubu in June 2025 and are being implemented according to the gazetted statutes. Adedeji emphasized that the NRS is executing the law as officially published, not the previously circulated harmonized versions.
The reforms focus on taxing profits, consumption, and returns, rather than mere capital transfers or investments. Previously, companies were taxed on turnover even when making losses, but under the new system, minimum tax applies only to profit.
The government maintains that these changes are part of a broader strategy to enhance fiscal sustainability, stimulate investment, and ensure that the poorest Nigerians are not unduly burdened by taxation.
Critics had raised concerns over certain provisions, but officials insist the reforms are necessary to modernize Nigeria’s tax system and promote economic growth.
Amanze Chinonye is a Staff Correspondent at Prime Business Africa, a rising star in the literary world, weaving captivating stories that transport readers to the vibrant landscapes of Nigeria and the rest of Africa. With a unique voice that blends with the newspaper's tradition and style, Chinonye's writing is a masterful exploration of the human condition, delving into themes of identity, culture, and social justice. Through her words, Chinonye paints vivid portraits of everyday African life, from the bustling markets of Nigeria's Lagos to the quiet villages of South Africa's countryside . With a keen eye for detail and a deep understanding of the complexities of Nigerian society, Chinonye's writing is both a testament to the country's rich cultural heritage and a powerful call to action for a brighter future. As a writer, Chinonye is a true storyteller, using her dexterity to educate, inspire, and uplift readers around the world.
