FG begins six week review of new tax laws

The Federal Government has commenced a comprehensive six-week review of Nigeria’s new tax laws to address implementation gaps, ambiguities, and unintended consequences that have surfaced since the legislation took effect in January.

The initiative was launched on Thursday in Abuja by the Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, who inaugurated the Technical Subcommittee on Fiscal Policy and Tax Reforms.

The findings and recommendations from the exercise are expected to form a core component of the upcoming Finance Bill 2027.

The sweeping tax overhaul comprising the Nigeria Tax Act 2025, the Nigeria Tax Administration Act 2025, the Nigeria Revenue Service (Establishment) Act 2025, and the Joint Revenue Board (Establishment) Act 2025 became fully operational on January 1, 2026.

Speaking at the inauguration, Oyedele noted that while the fundamental principles of the reforms remain sound, practical implementation has exposed areas requiring refinement as businesses, administrators, and investors navigate the new framework.

Emphasizing that the current review is not an attempt to roll back the 2025 reforms, Oyedele explained that the goal is continuous economic improvement.

He tasked the subcommittee with identifying ambiguous clauses, mitigating unintended economic fallout, simplifying compliance, and boosting national competitiveness. The scope of the review extends beyond taxation to encompass broader fiscal management, public debt, transparency, capital markets, and cross-border capital flows.

The government has already gathered public feedback, receiving 134 electronic submissions across geopolitical zones alongside hard-copy proposals. Initial stakeholder concerns center on clarifying VAT thresholds, restructuring withholding tax mechanisms, refining capital gains treatments, and combating multiple taxation. Additional proposals advocate for enhanced data sharing between government agencies to curb administrative redundancies, faster tax refunds, and stronger safeguards for small businesses and vital sectors like mining, renewable energy, and healthcare.

Addressing specific fiscal pressures, Oyedele warned against complex tax regulations, noting that administrative complexity acts as a hidden tax that raises compliance costs and creates loopholes for arbitrage.

He also stressed the need to recalibrate withholding tax so that it functions purely as an advance-payment and compliance tool rather than a drain on corporate working capital, which is particularly critical given Nigeria’s high cost of capital.

Beyond drafting recommendations for the Finance Bill 2027, the subcommittee has been mandated to review the Deduction of Tax at Source Regulations 2024 to draft revised withholding tax rules, alongside updating the Companies Income Tax (Significant Economic Presence) Order 2020 to align with current international practices.

Chaired by the Permanent Secretary of the Federal Ministry of Finance with the Chairman of the Tax Advisory Committee serving as co-chair, the multidisciplinary subcommittee includes representatives from key federal agencies, regulatory bodies, major professional institutions, and the organized private sector. The panel has been given a strict six-week timeline to conclude its assignment and submit its report.

Co-chair Albert Folorunsho assured that the committee would engage extensively with relevant stakeholders to ensure the final recommendations are technically sound, administratively viable, and responsive to the practical realities faced by taxpayers and businesses alike.