President Bola Tinubu has signed four finance bills into law, aiming to restructure Nigeria’s tax system and boost revenue generation.

The fiscal reform laws are expected to simplify revenue collection, reduce tax burdens on low-income earners and small businesses, and increase government revenue.

In this article, explained Nigeria’s major tax overhaul with keen emphasis on its impacts on Nigerians.

ALSO READ: 

Low-income households stand to benefit the most, as many will no longer have to pay income tax while also enjoying price relief on essentials. Small businesses should also see positive changes through more streamlined bureaucracy, which could help boost compliance and encourage informal traders to enter the tax system.

Challenges and Concerns:

Aim

The government aims to grow Nigeria’s tax-to-GDP ratio to 18% by 2026 without raising taxes on basic goods or overburdening struggling citizens. By simplifying tax rules and encouraging voluntary compliance, officials hope to raise more money for funding infrastructure and public services, such as healthcare and education, as well as reduce the reliance on borrowing money.