Abuja, Nigeria -June 28, 2025: The Federal Government has rolled out radical changes to Nigeria’s tax law reforms, which aim to increase revenues and modernize the country’s tax system.
President Bola Tinubu has signed the Finance Act 2024 into law, introducing new taxes and modifying existing taxes. The legislation is designed to fill the revenue gap and increase the country’s fiscal sustainability.
Below are the most important aspects of tax reforms that every Nigerian must know:
Digital Assets Now Attract a 10% Tax.
For the first time, cryptocurrency and other digital currencies, including cryptocurrencies, will be subject to the 10 percent capital gain tax. It is a requirement that Nigerians dealing in Bitcoin, Ethereum, or other digital currencies have to be taxed on the profits they earn.
Experts believe this move is designed to profit from Nigeria’s fast-growing digital economy and bring cryptocurrency transactions under the supervision of a regulator.
Excise Duties on Telecom Services
A new 5% excise duty is applied to telecom services such as SMS, calls, and internet data.
Subscribers will be charged more on their data and telephone bills as telecom companies collect and pay this tax to the federal government. Analysts say it could increase the costs of living of thousands of Nigerians.
Stamp Duties Expanded
The range of stamp duty has now expanded to include greater electronic transactions. Bank transfers over N10,000 leases for property and other types of payments are now subject to stamp duty fees.
The government hopes that this will dramatically increase non-oil revenue. However, small entrepreneurs are worried about the cost in everyday transactions.
Luxury Items to Face Green Taxes
The law proposes a tax on luxury goods such as yachts, private jets, and expensive cars. The “green tax” aims to stop extravagant spending and help fund climate-friendly projects.
Officials from the government say that the tax targets Nigeria’s wealthiest citizens and supports environmental initiatives.
Exemptions for Small Businesses
In an effort to promote small and micro companies, businesses earning less than N25 million a year are exempt from paying company income tax.
The government hopes this help will boost entrepreneurs and ease the tax burden for small-scale businesses.
Significance of the Tax Reforms
Based on the Federal Inland Revenue Service (FIRS), these measures are part of the larger attempts to broaden Nigeria’s income sources outside of oil, enhance tax compliance, and encourage investment in key areas essential to the nation’s economy.
Financial experts believe that the reforms may raise Nigeria’s tax-to-GDP ratio, which is among the lowest in Africa.
Public Reaction Mixed
While certain Nigerians believe that tax reforms are essential to stabilizing the economy, many are worried about their effects on household costs, specifically increasing costs for telecom and data.
Economic experts advise Nigerians to learn about the new tax policy and plan their budgets per the new tax policies.
Key Takeaways:
- Digital assets are now subject to 10 10% income tax for capital gains.
- Excise duty of 5% added to telecom services.
- Stamp duty increased to include more transactions.
- Tax on luxury that is imposed on yachts, private jets and luxury vehicles.
- Smaller businesses earning less than N25 million annually can be exempted from paying company tax.
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