Nigeria tax reforms exempt companies earning under N100m from income tax

Nigeria's ongoing tax reforms, driven by the Nigeria Tax Act and the Nigeria Tax Administration Act, aim to simplify the fiscal landscape and support economic growth. Under the new provisions, companies with an annual revenue below N100 million are exempt from company income tax, VAT, and withholding tax. Additionally, these small businesses are exempt from Capital Gains Tax and the new Development Levy.

Finance Minister Taiwo Oyedele has advocated for streamlining approximately 70 tax heads into 10 to ease compliance and promote formalization. The reforms also intend to reduce the corporate tax rate from 30 percent to 25 percent and allow certain sectors, such as education, to claim VAT refunds on expenses.

While the Nigeria Revenue Service (NRS) reports that federal allocations to states and local governments have increased significantly, challenges remain regarding the elimination of multiple taxes, levies, and permits that continue to affect business operations. Despite these hurdles, revenue collection reached a record N21.6 trillion in the first half of 2026, and the number of registered taxpayers has seen a substantial increase.