The Presidential Fiscal Policy and Tax Reforms Committee has revealed plans to provide tax relief to 95% of businesses operating in Nigeria’s informal sector. Mr. Taiwo Oyedele, the Committee’s Chairman, announced this during the committee’s closing session in Abuja.
Under the proposed system, businesses earning N25 million or less annually would be exempted from various taxes hindering their progress. Oyedele emphasized that this exemption would cover taxes such as withholding tax, company income tax, and payee on their staff.
The reforms will focus on the top 5% of the informal sector, the middle class, and the elite for tax collection. The committee is drafting laws to enact these changes in Nigeria’s fiscal policy and tax reform ecosystem, aiming for sustained reviews by all successive governments to prevent regression.
Oyedele stressed the importance of compliance and urged stakeholders to cooperate fully with the government to implement the new fiscal and tax policy for the benefit of citizens. He emphasized the need for leaders to lead by example in paying taxes promptly and correctly.
Vice President Kashim Shettima reiterated President Bola Tinubu’s commitment to revitalizing revenue generation while maintaining an investment-friendly and globally competitive business environment. Shettima clarified that the government’s intention is not to frustrate any sector but to establish an administrative system that ensures the benefits of a thriving tax system for all citizens.
It’s worth noting that small businesses in Nigeria have long struggled with multiple taxation from various levels of government. Oyedele previously stated that the committee was recommending to state and local governments across the country to suspend “nuisance taxes” that do not contribute to state revenue.
While the committee’s proposals aim to support small businesses and drive economic growth, the successful implementation remains contingent on government action.
