The Nigeria Tax Act 2025 (NTA), commonly referred to as part of the Nigerian Tax Reform Acts or Nigeria's 2026 tax reform, is a Nigerian federal statute that consolidates and overhauls the country's tax framework. It was signed into law by President Bola Tinubu on 26 June 2025, alongside three companion statutes, the Nigeria Tax Administration Act, the Nigeria Revenue Service (Establishment) Act, and the Joint Revenue Board (Establishment) Act, collectively known as the Tax Reform Acts. Most substantive provisions of the NTA took effect on 1 January 2026.
The Act repeals and consolidates several pre-existing tax statutes, including the Companies Income Tax Act, the Personal Income Tax Act, the Value Added Tax Act, the Capital Gains Tax Act, the Petroleum Profits Tax Act and the Stamp Duties Act, replacing them with a single, unified legislative framework. It is described by its drafters as the most significant restructuring of Nigeria's tax system in decades, intended to broaden the tax base, reduce the overall number of levies, and modernise administration through digital tools such as mandatory e-invoicing.
Background The Nigeria Tax Act originated from recommendations of the Presidential Fiscal Policy and Tax Reforms Committee, chaired by Taiwo Oyedele, which was tasked by the Tinubu administration with simplifying Nigeria's tax system and increasing government revenue without proliferating new taxes. Four related bills were introduced to the National Assembly and passed before being signed into law by President Tinubu on 26 June 2025. While some provisions of the accompanying Acts took effect immediately upon assent, implementation of the core NTA provisions was initially delayed, with the government pushing the commencement date to 1 January 2026 amid concerns about the impact of a proposed fuel surcharge on the cost of living.
Key provisions
Personal income tax The Act introduces a more progressive personal income tax regime. Individuals earning ₦800,000 or less per year are fully exempt from personal income tax, while higher earners are taxed at progressively higher marginal rates up to 25%. The tax-exemption threshold for compensation for loss of employment or injury was also raised, from ₦10 million to ₦50 million. The law defines "resident" and "non-resident" individuals more precisely, extending Nigerian tax liability to the worldwide income of residents, determined by domicile, habitual abode, family and economic ties, or physical presence in Nigeria for at least 183 days in a year.
Corporate and capital gains tax Small companies, defined as businesses with annual gross turnover of ₦100 million or less and total fixed assets not exceeding ₦250 million, are exempted from Companies Income Tax, Capital Gains Tax, and a newly introduced Development Levy. The Capital Gains Tax rate for companies was raised from 10% to 30%, aligning it with the corporate income tax rate, and the Act extends Capital Gains Tax to indirect transfers of shares in Nigerian companies through offshore holding structures. A new Development Levy of 4% of assessable profits applies to non-exempt companies, consolidating several pre-existing levies, including the Tertiary Education Tax, the Information Technology Levy, the NASENI levy, and the Police Trust Fund levy. Large multinational groups are subject to a minimum effective tax rate of 15%, in line with international efforts on global minimum taxation.
Value-added tax The standard Value Added Tax rate of 7.5% was retained, but the Act expands the list of VAT zero-rated goods and services to include basic food items, medical and pharmaceutical products, educational materials, tuition, and electricity transmission services, and it introduces broader input VAT recovery rights for businesses. The Act also codifies mandatory e-invoicing and "VAT fiscalisation" rules, requiring businesses to adopt a tax-authority-administered digital invoicing system.
Administration The companion Nigeria Revenue Service (Establishment) Act replaces the Federal Inland Revenue Service (FIRS) with a new agency, the Nigeria Revenue Service, as the central body responsible for assessing and collecting federally-collectible taxes. The Joint Revenue Board (Establishment) Act creates a coordinating body between federal and state tax authorities, and the package also establishes a Tax Ombuds office to mediate taxpayer disputes.
Implementation and reception The reforms took effect amid an already difficult economic backdrop shaped by the 2023 removal of Nigeria's fuel subsidy and a sharp naira devaluation, and commentators noted that the timing made the changes politically sensitive. The main opposition Peoples Democratic Party called for a suspension of the Act's commencement date, alleging discrepancies between the version of the law passed by the National Assembly and the version later gazetted by the government. In January 2026, professional services firm KPMG Nigeria published an analysis identifying what it described as errors, gaps and inconsistencies in the gazetted text, including in provisions on share taxation, dividend treatment, and non-resident obligations, and called for the laws to be reviewed. Taiwo Oyedele, chairman of the Presidential Fiscal Policy and Tax Reforms Committee, publicly rejected KPMG's criticisms and defended the Act's drafting and policy intent. The Nigerian government has continued to describe the reforms as intended to protect low-income earners and small businesses while broadening the overall tax base.
See also Federal Inland Revenue Service Economy of Nigeria Bola Tinubu
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