New Nigeria Tax Reforms Explained: Who Benefits, VAT Changes, and How It Affects Your Income

The Federal Government of Nigeria has clarified that low-income earners are the primary beneficiaries of the newly introduced tax reforms signed into law by President Bola Ahmed Tinubu.

The clarification was made by the Executive Chairman of the Nigeria Revenue Service, Zacchaeus Adedeji, during a televised interview on Sunday. According to him, the reforms are designed to ease the financial burden on poor Nigerians rather than increase taxes.

Adedeji explained that the government is not imposing additional taxes on citizens. Instead, the new tax structure expands exemptions, ensuring that more than 95 percent of Nigerians classified as poor are completely exempted from paying taxes under the new law.

He emphasized that the removal of Value Added Tax on food items is a major relief for low-income households, noting that food accounts for nearly 90 percent of the disposable income of poor Nigerians.

He further stated that VAT has also been removed from transportation services, another essential expense that significantly affects low-income earners across the country.

According to Adedeji, when all exemptions and adjustments are considered, the overall impact of the tax reforms clearly favors poor Nigerians more than any other group.

He added that the reforms align with the government’s broader economic strategy to reduce hardship, improve welfare, and ensure a fairer tax system that supports vulnerable citizens while strengthening national revenue.