Four Tax Bills Signed into Law Under Tinubu – A Fiscal Turning Point?
Four Tax Bills Signed into Law Under Tinubu – A Fiscal Turning Point
Jerry Adesewo
On June 26, 2025, President Bola Ahmed Tinubu signed into law four major tax reform bills, collectively representing a significant shift in Nigeria’s fiscal policy. These bills, which passed through rigorous legislative scrutiny, aim to modernize tax administration, boost revenue, and enhance equity across Nigeria’s economy.
READ ALSO: Africa’s Top Generals to Meet in Abuja for Historic Defence Summit Amid Regional Tensions
The questions probably on the minds of many Nigerians would be: “And so what? Who tax reform bills help?” Hence, the need to help Nigerians understand the content of these bills, their expected benefits, and the road ahead.
What Are the Four Bills?
1. Nigeria Tax Bill – Consolidates multiple taxation laws into one unified, streamlined framework. It lowers corporate tax rates (from 30% to 25%) and exempts small businesses (annual turnover under ₦25 million) from profit tax.
2. Nigeria Tax Administration Bill – Revises the administrative architecture, mandating sharing of key financial data (e.g., individual bank transactions over ₦25 million) and sets procedures for efficient tax collection.
3. Nigeria Revenue Service (Establishment) Bill – Replaces the Federal Inland Revenue Service with a revamped Nigeria Revenue Service (NRS), broadening its mandate to include royalties, excise, VAT, customs, and more.
4. Joint Revenue Board (Establishment) Bill – Establishes a Joint Revenue Board and Tax Appeal Tribunal to address disputes and harmonize federal–state revenue efforts.
Why This Matters
Unifying a Fragmented System: By consolidating old statutes and centralizing authority under the NRS, the reforms aim to eliminate inefficiencies, legal overlaps, and institutional confusion .
Pro-Poor Taxation: With personal income tax now exempt for earners below ₦800,000, the bills shift tax burdens toward higher earners and formal entities, and support startups and small businesses prospectively excluded from profit tax.
Business-Friendly Environment: Reduction in corporate rates and harmonization of levies lowers operational costs, incentivizing investment and growth.
Revenue Mobilization: Doubling Nigeria’s tax-to-GDP ratio from its low current level could unlock crucial funding for health, education, infrastructure, and poverty alleviation.
Digital Compliance: Incorporating bank-data-sharing provisions promotes transparency, enhances compliance, and broadens the tax base.
Expert and Government Perspectives
Finance Minister Wale Edun emphasised that the reforms, after surviving legislative hurdles, promise efficiency and fairness, crediting Tinubu’s tenacity and the simplification efforts led by fiscal expert Taiwo Oyedele.
President Tinubu framed the reforms as relief for low-income earners and small businesses, describing the changes as paving the way for equitable tax burdens and stronger fiscal systems.
Oyedele’s committee urged reduced corporate and tariff rates, calling for digitisation, fiscal prudence, and refocusing government roles to essential service delivery, backed by robust local dialogue.
What Are Challenges Ahead
Implementation Risks: Transitioning to centralized tax and enforcement under the new regime is complex, requiring staff retraining, IT overhaul, and institutional collaboration.
Resistance Possibilities: Higher earners or state governments adjusting to new revenue-sharing arrangements may raise objections to bank reporting or levy changes.
Sustainability Testing: Without prudent use of increased revenues, poor spending could erode public trust and negate reform gains.
Elite Buy-In: Encouraging voluntary compliance among professionals and business leaders remains critical, requiring persuasive public engagement.
Path Forward
1. Dedicated Implementation Task Force: Coordinated efforts across federal and state lines with clear timelines and performance indicators.
2. Technology Infrastructure: Investment in robust IT systems and automation to support banking data transfers and centralized collection.
3. Continuous Public Outreach: Building tax morale through transparent reporting and visible reinvestment in social services.
4. Policy Fine-Tuning: Periodic review mechanisms for corporate rates, relief targeting, and process adjustments, aligned with economic conditions.
5. Fiscal Discipline and Transparency: Demonstrable fiscal restraint—spending aligned with revenue flows to maintain credibility and momentum.
In Conclusion
With these landmark tax laws, Nigeria has embarked on a transformative journey, moving from fiscal fragmentation to a unified, fair, and modern taxation system. If implemented with discipline, transparency, and political will, these reforms could stabilize the nation’s finances, enhance public services, and foster a pro-investment climate. But the real test lies not in lawmaking, but in the rollout, and Nigeria’s future prosperity depends on execution as much as aspiration.
Four Tax Bills Signed into Law Under Tinubu – A Fiscal Turning Point