Tax Reforms Aim to Empower Nigerian Entrepreneurs
The Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, Taiwo Oyedele, has called on Nigerian entrepreneurs to formalise their businesses in order to take advantage of the Federal Government’s new people-centred tax policies. These reforms include exemptions for small companies and minimum-wage earners from paying taxes.
Oyedele made this appeal during a panel discussion titled ‘The New Tax Law and You’ at the 24th Annual Conference of the Women in Management, Business and Public Service. He highlighted that the government’s tax reforms are designed to reward compliance and ensure that businesses can grow before being taxed.
Key Points of the Tax Reforms
President Bola Tinubu signed into law four tax reform acts in June, with two of them already in effect and the remaining two expected to come into force by January 1, 2026. Oyedele explained that the reforms focus on how people do business, how those businesses grow, and how finance is managed.
He stated, “You can’t knock on the door and say, ‘Tax me.’ Let’s have a conversation on how to create a business that can pay corporate tax. So, the reforms are people-centric.”
One of the key benefits of the reforms is that small companies with an annual turnover of N100m or less will not pay any corporate tax. Additionally, the Corporate Affairs Commission has announced plans to register 250,000 small companies free of charge.
Focus on Essential Sectors
The tax reforms also aim to ensure fairness in value-added tax (VAT) administration. Certain critical sectors will be fully exempted from VAT starting next year. For example, a bottle of water will be zero-rated for VAT, meaning producers won’t charge VAT when selling it. However, they may have incurred VAT on various inputs like plastic, labels, and delivery services.
Oyedele explained that the government analyzed how Nigerians spend their income and decided to lift taxes on essential sectors. “Data shows that almost 80 per cent of the bottom of Nigerian households spend their entire income on five items — food, education, health, rent, and transportation. I’m saying for these five things, why don’t we remove the taxes on them?” he asked.
Protecting Taxpayers
To protect taxpayers and reduce harassment by revenue officials, the government has established a new Office of the Tax Ombudsman. This office will provide support to individuals who feel they are being unfairly treated by tax authorities.
“If anybody shows up and they want to harass you, they want to collect tax, they want to seal up your premises — in your anger, you can call the Tax Ombudsman,” Oyedele said. “You don’t need to be happy with them; they have a duty and a legal obligation to come to your aid, protect your rights, and they’ve been given so much power to make sure your right is protected.”
He encouraged organizations such as WIMBIZ and other professional groups to nominate and train members who can act as liaisons to escalate cases to the Ombudsman when needed.
Support for Informal Businesses
Oyedele also emphasized that truly small, informal businesses would be shielded from unnecessary tax pressures through a system of visible exemptions. For instance, individuals engaged in activities like roasting corn by the roadside, vulcanising, or carpentry would receive exemption stickers, allowing them to operate without the burden of taxation.
“Those guys — we’re planning to give them exemption stickers so they just live their life. That is how direct and practical it is,” he said.
A Shift in Taxation Philosophy
Throughout the session, Oyedele reiterated that the tax reform drive was not about adding burdens but about empowering citizens and enterprises to grow. “We have to stop taxing poverty. We have to stop taxing capital. We have to stop taxing investment. That’s why Mr President said we will no longer tax seed; we’ll wait, invest with you, and tax the fruits,” he declared.
The 24th Annual Conference of WIMBIZ
The 24th annual conference of WIMBIZ is being held under the theme, ‘Own Your Story, Walk in Power and Nurture the Future.’ This event brings together leaders in management, business, and public service to discuss relevant issues and explore opportunities for growth and development.