President Bola Tinubu the tax reform bills into law earlier on Thursday.

The tax reforms are to be from January 2026, according to Zacch Adedeji, chairman of the Federal Inland Revenue Service (FIRS).

Speaking on ‘Politics Today,’ a Channels Television programme, on Thursday, Oyedele said the exemption is part of a broader effort to protect low-income earners, reform a historically opaque tax system, and make taxation fairer and more efficient.

Commenting on what his committee described as a poor household, Oyedele said they “came up with a N120,000 or N130,000 per two people working in a household of five”.

“If the earnings are about N250,000, they can take care of themselves. Of course, they are not going to have luxury, but at least they can take care of themselves. They are poor, and they shouldn’t pay taxes,” he added.

Oyedele said the tax law will not put cash in their pocket, but at least it will not “take anything out if you’re poor”.

“We have eliminated the tax component for people at the bottom, we have reduced it for people at the middle, and we have increased slightly for people at the top,” he added.

Oyedele said the committee used household data, not just World Bank benchmarks, to determine the poverty line, factoring in local realities like subsistence farming and informal economies.

Also, the chairman said the reforms are progressive by design, adding that while low-income earners will be fully exempt, middle-income households, earning around N1.8 million and N2 million a month, will see lower tax rates, and top earners, those making N2 million and above monthly, will contribute slightly more.

He said the people earning N2 million and above monthly are less than 5 percent of all workers.

Furthermore, the tax expert said the “reform is pro-poor, pro-business, and pro-growth”.

“We’ve eliminated taxes for the poor, reduced the burden on the middle, and only slightly increased it for the wealthy. That’s what fairness looks like,” he added.

‘TAX EVADERS, WASTEFUL INCENTIVES TARGETED’

The tax expert also said the government is not trying to raise taxes; instead, the focus is on improving compliance, efficiency, and digital tracking.

“Now we have the data. From your BVN, electricity bills, land purchases, bank accounts, and even your phone number, we can track economic activity. If you under-report, we’ll find out,” he said.

He added that Nigeria currently collects only about 30 percent of its potential tax revenue, with a 70 percent gap driven by evasion, inefficiencies, and loopholes.

“If we just close that gap by half, we can double government revenue without taxing people more,” he said.

Oyedele also said that more revenue will come from eliminating tax evasion and reviewing wasteful incentives, not from increasing rates on struggling Nigerians.