President Bola Ahmed Tinubu has assented to the four tax reform bills recently passed by the National Assembly, ushering in a new Nigerian tax regime.
The President signed the four tax bills into law during a ceremony at the Presidential Villa on Thursday, June 26, 2025.
The ceremony was attended by the leadership of the National Assembly; the President of the Senate, Senator Godswill Akpabio, and the Speaker of the House of Representatives, Hon. Tajudeen Abbas, some federal legislators, governors, ministers, and aides of the President.
Pan-Atlantic Kompass reports that the four bills signed by Tinubu are; the Nigeria Tax Bill, the Nigeria Tax Administration Bill, the Nigeria Revenue Service (Establishment) Bill, and the Joint Revenue Board (Establishment) Bill.
In his address during the ceremony, Tinubu assured Nigerians that the new Nigerian tax regime will significantly transform tax administration in the country, leading to increased revenue generation, improved business environment, and a boost in domestic and foreign investments.
Speaking after the signing ceremony, the Chairman of the Federal Inland Revenue Service (FIRS), Zacch Adedeji, said the new tax regime would begin on January 1, 2026.
He stated: “It takes time for all the stakeholders, participants, operators, and the regulator to change the system.
“So, with the magnanimity of the National Assembly, Mr President assented to the bills. So, the effective date will be January 1, 2026. We have six full months for both sensitisation and planning. This is also considering the fiscal year of the government because when you have this kind of change, it’s not what you do in the media.”
Below is a breakdown of some major aspects of the new laws;
1. FIRS Renamed: The Federal Inland Revenue Service (FIRS) has now been renamed and would be referred to as the Nigeria Revenue Service (NRS).
2. Unified Revenue Collection: The law will empower the NRS to handle revenue collections previously managed by agencies like the Nigeria Customs Service, NUPRC, NPA, and NIMASA.
3. Low-Income Relief: Under the new law workers earning ₦800,000 or less annually are now exempted from income tax.
4. High-Income Tax: According to the new law, individuals earning N50 million annually will now pay a 25% personal income tax.
5. Small Business Exemption: Small business owners are also fully exempt from paying income tax under the new law.
6. Corporate Tax Cut: Starting in 2026, company income tax for medium and large firms will be reduced from 30% to 25%.
7. VAT Exemptions on Essentials: The new law has removed VAT charges on essential items like food, medical services, pharmaceuticals, school fees, and electricity.
8. No Tax Hike: VAT remains at 7.5%, and corporate income tax stays at 30%—there has been no increase.
9. New Development Levy: A 2%–4% Development Levy will now fund critical national institutions like NELFUND, TETFund, NITDA, and NASENI.
