FG begins fresh review of tax laws, fiscal policies

The Federal Government has commenced a fresh review of Nigeria’s tax laws and fiscal policies, following the inauguration of a Technical Subcommittee on Fiscal Policy and Tax Reforms to identify areas requiring clarification, refinement and further reform.

Inaugurating the subcommittee in Abuja, Chairman of the Presidential Fiscal Policy and Tax Reforms Committee and Minister of Finance and Coordinating Minister of the Economy Professor Taiwo Oyedele said the exercise was necessary because the implementation of the new tax laws would inevitably reveal areas requiring improvement.

Oyedele said the review was not intended to rewrite the fundamental reforms enacted in 2025, but to preserve their principles while responding to lessons from implementation and emerging economic realities.

The 2025 reforms comprised the Nigeria Tax Act, Nigeria Tax Administration Act, Nigeria Revenue Service (Establishment) Act and Joint Revenue Board (Establishment) Act, which came into full effect on 1 January 2026.

He said: “Good reform is a process, not an event. The real test begins when the law meets the economy, as businesses interpret it, administrators implement it, investors respond to it, and citizens experience it.”

According to him, the Finance Bill 2027 should therefore address ambiguities, unintended consequences and compliance difficulties identified during implementation, while improving investment and competitiveness.

Oyedele said the public Call for Inputs received 134 submissions from all geopolitical zones, with proposals covering taxation, fiscal policy and management, public financial management, debt, transparency, capital markets and cross-border capital flows.

He identified some emerging concerns from the submissions, including the need to clarify and simplify provisions relating to VAT thresholds, withholding tax and capital gains treatment, as well as calls to tackle multiple taxation and improve co-ordination among revenue authorities.

Other proposals, he said, focused on digitalisation and data-sharing to reduce the burden of taxpayers repeatedly submitting information already held by government, alongside stronger taxpayer rights, faster refunds and safeguards for small businesses.

Oyedele charged the subcommittee to assess the submissions on their merits and base its recommendations on evidence and the national interest.

He said proposed changes should be assessed based on the problems they seek to solve, their costs, beneficiaries, those who would bear the burden and possible unintended consequences.

The minister also urged the subcommittee to prioritise economic competitiveness and productivity, stressing the need to encourage investment, manufacturing expansion and formalisation.

He said the government’s philosophy remained that taxation should focus on wealth and value creation rather than poverty and productive activity.

Oyedele further tasked the subcommittee with reviewing the Deduction of Tax at Source Regulations 2024 against the new tax laws and preparing revised Withholding Tax Regulations.

He stressed that withholding tax was an advance-payment and compliance mechanism and should not become an additional cost of doing business or a tax on working capital.

The subcommittee was also mandated to review the Companies Income Tax (Significant Economic Presence) Order 2020 and develop an updated framework aligned with the new tax laws and international best practices.

Oyedele said Nigeria needed to protect its legitimate taxing rights in the digital and globalised economy while remaining competitive for technology and cross-border investment. He gave the subcommittee six weeks to complete its assignment and submit its report.

The minister said representatives of the Ministry of Finance, Ministry of Justice, Nigeria Revenue Service, Joint Revenue Board, Nigeria Customs Service, SMEDAN, organised private sector and professional bodies had been brought together to ensure that issues were resolved collaboratively.

He directed members to maintain confidentiality over their deliberations and working drafts until authorised for release, while disclosing and recusing themselves from matters involving conflicts of interest.

Oyedele said the first phase of the government’s tax reform was focused on changing the architecture of the system, while the next phase should ensure that the new framework works better by reducing complexity and providing clarity and predictability.

“Success will not be measured by how many sections we change, but by how many real problems we solve,” he said.