VAT, Withholding Tax, Capital Gains Top FG’s Tax Review Agenda

The federal government has placed Value Added Tax (VAT), withholding tax and capital gains treatment at the centre of a fresh review of Nigeria’s tax regime, following 134 submissions received from stakeholders across the country.

The review panel, inaugurated in Abuja yesterday by the minister of Finance and coordinating minister of the Economy, Taiwo Oyedele, has six weeks to submit its recommendations.

The government said the move is to address ambiguities, unintended consequences and compliance challenges that have emerged from the implementation of the new tax laws.

The Technical Subcommittee on Fiscal Policy and Tax Reforms is expected to review stakeholder submissions, examine the Finance Bill 2027, revise the Withholding Tax Regulations, and update the framework governing Significant Economic Presence.

Oyedele said the exercise was not intended to rewrite the fundamental reforms enacted in 2025, but to identify areas where implementation had exposed gaps requiring clarification or adjustment.

“No serious reform ends with the enactment of legislation. Good reform is a process, not an event. The real test begins when the law meets the economy, as businesses interpret it, administrators implement it, investors respond to it, and citizens experience it,” he said.

According to him, the Nigeria Tax Act 2025, Nigeria Tax Administration Act 2025, Nigeria Revenue Service (Establishment) Act 2025 and Joint Revenue Board (Establishment) Act 2025, which took full effect on January 1, represented the most comprehensive reform of Nigeria’s tax system in decades.

He, however, said the Finance Bill 2027 should be used to improve the implementation of the reforms rather than reverse their fundamental principles.

“Our task is not to rewrite the 2025 reforms, but to preserve their fundamental principles while learning from implementation and responding to new economic realities,” Oyedele said.

The minister said stakeholders called for the clarification and simplification of the new tax laws, particularly provisions relating to VAT thresholds, withholding tax and capital gains treatment.

Other issues raised included multiple taxation, coordination among revenue authorities, digitalisation and data-sharing, taxpayers’ rights, faster refunds and safeguards for small businesses.

Oyedele charged members of the subcommittee with ensuring that proposed changes did not impose unnecessary burdens on taxpayers or distort economic activity.

On withholding tax, he said the panel would review the Deduction of Tax at Source Regulations 2024 against the new tax laws and prepare revised Withholding Tax Regulations.

Members of the committee include representatives of the Federal Ministry of Finance, Ministry of Justice, Nigeria Revenue Service, Joint Revenue Board, Nigeria Customs Service, Manufacturers Association of Nigeria, Small and Medium Enterprises Development Agency of Nigeria, Association of National Accountants of Nigeria, Chartered Institute of Taxation of Nigeria, Institute of Chartered Accountants of Nigeria and Nigerian Economic Summit Group.

Others include representatives of the Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture, Nigerian Investment Promotion Commission, Budget Office of the Federation, Central Bank of Nigeria, Debt Management Office, Nigerian Bar Association and the Big Four accounting firms.

Responding on behalf of the members, the Co-Chairman of the Tax Advisory Committee, Albert Folorunsho, pledged the committee’s commitment to the assignment.

He said, “I am deeply humbled and honoured to accept this appointment. On behalf of every member present, we focus on reform that strengthens revenue mobilisation without imposing unnecessary burdens on taxpayers.”

Folorunsho also pledged that the committee would rely on evidence in carrying out its assignment and put the national interest first.