•Small business owners, individual taxpayers remain unclear about filing procedures, compliance timelines
•Users report slow response times on portals
•Authorities roll out updated platforms for registration, filing and payments
By Peter Egwuatu, Assistant Business Editor
Anxiety by Nigerians trailed the first two working days of 2026 as salary earners, traders and, to a large extent, corporates woke up to a tax system that has quietly but fundamentally changed.
Discussion so far by Nigerians has been centered on the new tax regime and most concerned are the ordinary people, especially the low income earners who kept asking questions upon questions.
With the commencement of Nigeria’s 2025 tax laws, the country has entered a new fiscal era promised by the Federal Government as fairer, broader and more efficient.
Yet, as tax portals went live and compliance deadlines loomed, early signals from businesses and taxpayers suggest that while the take-off has been largely orderly, the road ahead may be defined by learning curves, digital hiccups and growing public scrutiny among others.
Low-income earners need not to panic
Sunday Vanguard analysis of the new tax regime shows that low income earners are most benefitted, while the high income earners pay higher.
Under the new tax regime (bracket), salary earners with gross annual income of N800,000 and below or maximum monthly income of N66,700 approximately per month are exempted from paying tax. Workers with an annual gross income of above N800,000 to N2,999,999 are expected to pay a 15% tax rate. If, for example, a worker earns an annual income of N850,000, he or she is expected to pay N127,000 as annual tax or with monthly income of N70,833.33, the person is expected to pay N10,625 as monthly tax.
For the middle level salary earners, whose annual income falls between N3 million and 11.0 million, they are expected to pay a tax rate of 18%. For instance, a person under this category earning N3 million, as annual gross income, is expected to pay N179,100 as annual tax, while its monthly tax is N45,000, with monthly gross income of N250,000.
The senior level workers, with an annual gross income of N12 million to N24,999,999 are expected to pay a tax rate of 21%. For instance, if a worker earns N12 million, its annual tax is N2520,000 or with monthly income of N1.0 million, its monthly tax is N210,000.
For the executive level salary earners whose gross income falls between N25 million and N49,999,999, their tax rate is 23%. For instance, if a worker earns N25 million annually, its tax is N958,314.16 or with monthly income of N12,083,333, its monthly tax is N479,166.66. The person earning N49,999,999 annual income is expected to pay annual tax of N11,499,999.77 or with monthly income of N4,166,666.58, the person is expected to pay N958,333.31.
The last category, which is top earners whose salary falls from N50 million and above, has a tax rate of 25%. If, for instance, a person, with an annual gross income of N55 million, the expected tax payment would be N13,750,00 or a monthly gross income of N4,583,333.33 for N1,145,833.33 as tax.
Company tax/VAT
Under Nigeria’s new tax law, the Value Added Tax (VAT) rate remains at 7.5%, while the Company Income Tax (CIT) calculation is based on a tiered structure, with a 0% rate for small companies and a standard 30% for others.
What changed with tax laws?
The four legislations are:
Nigeria Tax Act (NTA) 2025: This Act consolidates and streamlines over a dozen existing federal tax laws, including the Companies Income Tax Act, Personal Income Tax Act, and Value Added Tax Act, into a single, unified framework.
Nigeria Tax Administration Act (NTAA) 2025: This legislation establishes a harmonized procedural framework for the assessment, collection, and enforcement of taxes across all tiers of government, aiming to bring consistency and clarity to the process.
Nigeria Revenue Service (Establishment) Act (NRSA) 2025: This Act formally replaces the Federal Inland Revenue Service (FIRS) with the new Nigeria Revenue Service (NRS), granting it a broader mandate and more autonomy to collect all federal taxes and revenues.
Joint Revenue Board (Establishment) Act (JRBA) 2025: This law establishes the Joint Revenue Board to improve coordination and data sharing between federal, state, and local government revenue authorities, and also formalizes the Tax Appeal Tribunal and the Office of the Tax Ombudsman for dispute resolution and taxpayer protection.
Therefore, the new tax framework consolidates and modernises Nigeria’s tax architecture through the four major legislations, aimed at harmonising overlapping taxes across federal and state levels; expanding the tax net without significantly increasing rates; strengthening enforcement and reducing leakages and digitising tax administration and compliance.
At the centre of the reforms is a shift from aggressive tax collection to compliance-driven revenue mobilisation, supported by technology and data integration.
How smooth has the take-off been?
Sunday Vanguard learnt that initial implementation has been largely calm, especially in Lagos State. Some of the key highlights expected include legal clarity.
Court rulings cleared the path for implementation, removing uncertainty that could have stalled enforcement.
Institutional readiness: Tax authorities rolled out updated digital platforms for registration, filing and payments.
Policy backing: The Federal Government reiterated that the reforms are not designed to impose new burdens but to close loopholes and ensure fairness.Large corporates and organised private sector players, already familiar with digital tax systems, appear better positioned to adapt quickly.
Early hitches emerge
Despite the orderly start, several issues have surfaced: Public confusion.
Many small business owners and individual taxpayers remain unclear about new filing procedures and compliance timelines as well as digital bottlenecks
Some users reported slow response times on tax portals.
There were also difficulties with registration and data verification as well as integration issues with existing systems.
Meanwhile, opposition parties, labour groups and civil society organisations continue to question transparency in the law-making process, enforcement powers granted to tax authorities and timing of implementation amid economic hardship.
Teething challenges
Financial analysts say coming months will test the reforms in three critical areas: Capacity of tax officials, especially at state and local levels; cost of compliance for Micro Small and Medium Enterprises, MSMEs and informal businesses; and consistency of enforcement, to avoid abuse or selective application. Without sustained taxpayer education and technical support, experts warn that resistance could grow.
What Nigerians should expect next
Government officials have promised: Continuous stakeholder engagement; Review of contentious provisions and improved digital infrastructure and taxpayer support.
For taxpayers, the key test will be whether the reforms translate into fairer taxation, reduced harassment and visible public benefits.
Nigeria’s 2025 tax laws mark one of the boldest attempts in decades to fix a chronically weak revenue system. Analysts have noted that the take-off may not be flawless, but its success will ultimately depend on execution, transparency and public trust. As compliance replaces coercion and technology reshapes tax collection, Nigerians will be watching closely not just what they pay, but what the nation gains in return.
Things Nigerians must know as 2025 tax laws begin
- No new tax rates but a wider net.
Government insists the reforms are not about hiking rates.
Instead, authorities are expanding the tax net, targeting previously untaxed or under-taxed segments of the economy.
2. Digital compliance is now central. Registration, filing and payments are increasingly online. Tax Identification Numbers (TINs), bank data and national identity systems are now more tightly linked, reducing anonymity.
3. Stronger enforcement powers.
The tax authorities now have broader powers to recover unpaid taxes, raising concerns among businesses about safeguards and due process.
4. Small businesses feel the pressure first. While large firms are largely prepared, MSMEs and informal operators face higher compliance costs, including the need for consultants and digital tools.
Lastly, a transition period is expected. Government officials admit there will be teething problems.
Enforcement, they say, will initially focus on education and gradual compliance rather than punishment.
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