New Nigeria Tax Act 2025 to attract foreign investment, create jobs — IMPI
By Seun Ibiyemi
The Independent Media and Policy Initiative (IMPI) has expressed strong confidence that the newly signed Nigeria Tax Act (NTA) 2025 will play a pivotal role in attracting foreign direct investment and generating employment across multiple sectors of the economy.
In a statement issued on Tuesday, IMPI Chairman Dr Omoniyi Akinsiju described the legislation, which will take effect from January 2026, as a major tax reform designed to eliminate double taxation, ease the burden on businesses, and boost investor interest in Nigeria.
“With the Nigerian tax laws set to be enforced from January 2026, we expect to see a renewed influx of foreign direct investment,” said Akinsiju.
He noted that the Act introduces pro-investor policies such as the Minimum Effective Tax Rate (ETR), Economic Development Incentive (EDI), and expanded tax thresholds for micro, small, and medium-sized enterprises (MSMEs).
According to Akinsiju, large corporations that are part of multinational groups with global revenues of at least €750 million or Nigerian revenues above ₦50 billion will now be taxed at 15% of their net income, down from the previous 30% corporate tax rate.
He explained that the reduced rate is aimed at preventing the double taxation of dividends and unrealised capital gains, providing clarity and relief for international investors.
The new legislation also replaces the former pioneer status tax holiday with the Economic Development Incentive, which allows qualifying companies to claim a 5% annual tax credit over five years on eligible capital expenditures. Unused credits and qualifying expenses can be rolled over for an additional five years.
“These reforms will not only make Nigeria more competitive as an investment destination but also promote long-term capital deployment and business expansion,” Akinsiju added.
Further provisions in the Act include raising the exemption threshold for capital gains tax on the sale of shares in Nigerian companies from ₦100 million to ₦150 million over a 12-month period, provided total gains do not exceed ₦10 million.
Akinsiju also pointed to the significant support the Act offers to small and medium-sized enterprises.
“Companies with annual turnover of up to ₦100 million and fixed assets not exceeding ₦250 million are now exempt from company income tax,” he said. This represents a marked increase from the ₦25 million turnover cap set under the 2020 Finance Act.
Medium-sized businesses newly eligible under this framework will benefit from lower regulatory and tax pressures, creating more room for growth, investment, and job creation.
Akinsiju further commended the broader fiscal strategy under President Bola Tinubu’s administration, noting that the NTA 2025 aligns closely with the Nigeria Tax Administration Act and the Nigeria Revenue Service (Establishment) Act.
“These aligned reforms, if properly executed, could be the most transformative policy shift for Nigeria’s economy in decades,” he asserted. “Together with the removal of fuel subsidies and exchange rate unification, the new tax regime lays the groundwork for sustainable and inclusive economic growth.”
He concluded by urging the Federal Government to maintain a consistent implementation framework and encourage engagement with stakeholders to ensure that the full impact of the reforms benefits both businesses and citizens.