morgANABLE politics/policy
Oyedele emphasised that the exercise is not intended to reverse the 2025 reforms but to strengthen them through continuous improvement.
KaNo—
The Federal Government has commenced a six-week comprehensive review of Nigeria’s 2025 tax reforms, in a move aimed at addressing implementation gaps, ambiguities and unintended consequences that have surfaced since the laws came into effect earlier this year.
The Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, disclosed this on Thursday in Abuja during the inauguration of the Technical Subcommittee on Fiscal Policy and Tax Reforms.
He noted that while the reforms marked a significant shift in Nigeria’s fiscal landscape, early implementation had revealed areas requiring further clarification and adjustment.
According to Oyedele, the review will focus on critical components of the tax system, including Value Added Tax thresholds, withholding tax, capital gains treatment and the persistent challenge of multiple taxation.
The outcome of the exercise is expected to shape proposals for inclusion in the Finance Bill 2027.
“The real test begins when the law meets the economy,” Oyedele said.
“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.”he added.
Nigeria’s sweeping tax reform framework, which includes the Nigeria Tax Act 2025, Nigeria Tax Administration Act 2025, Nigeria Revenue Service (Establishment) Act 2025 and the Joint Revenue Board (Establishment) Act 2025, came into full effect on January 1, 2026.
Tax Laws Designed To Improve Revenue
The laws were designed to modernise tax administration, improve revenue generation and reduce inefficiencies within the system.
However, stakeholders have since raised concerns about certain provisions and their real-world implications, prompting the government to initiate the current review.
Oyedele emphasised that the exercise is not intended to reverse the 2025 reforms but to strengthen them through continuous improvement.
He described the forthcoming Finance Bill 2027 as a critical policy instrument rather than a routine legislative exercise.
“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,” he said.
“We must identify where ambiguity exists, where unintended consequences have emerged, and where compliance can be simplified.”he added.
The minister further explained that the review would extend beyond tax laws to encompass broader fiscal policy considerations, including public financial management, debt sustainability, transparency, capital markets and cross-border capital flows.
134 Submissions Received From Stakeholders
He revealed that the government received 134 submissions from stakeholders across the country following a public call for input, alongside additional memoranda submitted in hard copy.
Preliminary feedback highlighted the need to simplify VAT thresholds, streamline withholding tax processes and clarify capital gains provisions.
Stakeholders also called for stronger measures to tackle multiple taxation, improve coordination among revenue authorities and enhance digitalisation within the tax system.
Proposals included the adoption of integrated data systems to prevent taxpayers from repeatedly submitting the same information to different government agencies.
There were also demands for stronger taxpayer rights, faster refund mechanisms and safeguards for small businesses, as well as targeted incentives to boost investment in key sectors such as mining, renewable energy, healthcare and capital markets.
Oyedele urged members of the subcommittee to carefully consider the broader economic implications of any proposed changes, particularly their impact on low-income households and businesses.
“Every tax reform produces winners and losers,” he said.
“The key question is whether a policy is fair, efficient and competitive, not whether it is universally popular. A provision that raises revenue may impose a far greater cost on the wider economy.”he added.
He also warned against overly complex tax rules, describing complexity as an additional burden on businesses.
“It raises compliance costs and creates room for discretion and arbitrage. Where two approaches achieve the same outcome, the simpler one should be chosen.”he stated.
As part of its mandate, the subcommittee will review the Deduction of Tax at Source Regulations 2024 and develop revised withholding tax regulations.
It is also expected to revisit the Companies Income Tax (Significant Economic Presence) Order 2020 to align it with the new tax framework and evolving international standards.
Oyedele stressed that withholding tax should remain an advance payment mechanism rather than an additional financial burden on businesses.
He cautioned that excessive withholding could tie down working capital and hinder business expansion, particularly in an environment characterised by high borrowing costs.
“In a country where the cost of capital is very high, withholding funds that businesses need for expansion even for a year can have significant economic consequences,” he said.
The minister gave the subcommittee six weeks to complete its assignment and submit its report.
The panel is chaired by the Permanent Secretary of the Federal Ministry of Finance, with the Chairman of the Tax Advisory Committee, Albert Folorunsho, serving as co-chair.
Its membership comprises representatives from key government institutions, including the Federal Ministry of Justice, Nigeria Revenue Service, Joint Revenue Board, Nigeria Customs Service, Central Bank of Nigeria, Debt Management Office, Budget Office of the Federation and the Nigerian Investment Promotion Commission.
Other members include representatives from the Small and Medium Enterprises Development Agency of Nigeria, Manufacturers Association of Nigeria, Nigerian Economic Summit Group, Nigerian Bar Association, Association of National Accountants of Nigeria, Chartered Institute of Taxation of Nigeria and the Institute of Chartered Accountants of Nigeria.
Private sector stakeholders, including the Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture and the “Big Four” accounting firms Deloitte, EY, KPMG and PwC are also represented.
Speaking at the inauguration, Folorunsho said the subcommittee would prioritise practical and evidence-based recommendations.
“Our recommendations must be technically sound, administratively practicable and responsive to the realities confronting taxpayers, businesses and government,” he said, adding that consultations would continue throughout the review period despite the tight timeline.
MAN Express Concerns Over Lack Of Positive Outcomes For Manufacturers
Meanwhile, the Manufacturers Association of Nigeria has expressed concerns that the benefits of the new tax laws have yet to be fully realised by manufacturers.
In its Manufacturers CEO Confidence Index report for the second quarter of 2026, the association noted that companies continued to face multiple tax collectors and regulatory agencies, despite the reforms aimed at streamlining the system.
The Director-General of the association, Segun Ajayi-Kadir, said the persistence of multiple taxation remained a major challenge.
“Manufacturers are yet to enjoy relief from multiple taxes and levies,” he said.
“The implementation of the Nigeria Tax Act 2025 has not fully achieved its objective of easing the burden on businesses.”he added
The report also highlighted broader challenges within the business environment, including rising production, distribution and logistics costs, which have continued to erode profitability despite modest gains in sales volume.
While local sourcing of raw materials showed some improvement largely due to foreign exchange constraints the association warned that insecurity in parts of the country could undermine these gains.
As the review process unfolds, analysts say its outcome will be critical in determining whether Nigeria’s tax reforms can achieve their core objectives of boosting revenue, simplifying compliance and creating a more competitive investment climate.
