NGX Introduces N150 Million Capital Gains Tax Exemption to Boost Nigerian Investors
The Nigerian Exchange Group (NGX) has announced a significant tax relief for investors in the country’s capital market, unveiling a N150 million annual exemption under the new Capital Gains Tax (CGT) regime. The announcement came during a high-level stakeholder dialogue on the Tax Reform Act 2024, aimed at providing clarity for investors, issuers, and market intermediaries ahead of the reforms. The new measure, effective from January 2026, is expected to protect the majority of retail investors from the 30 per cent tax on gains from share disposals.
Taiwo Oyedele, Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, explained that while the standard CGT rate remains 30 per cent, a reduced rate of 25 per cent will apply for proceeds reinvested in fixed income or other non-equity assets. He emphasized that reinvestments into Nigerian companies—whether listed or unlisted—will remain fully exempt, a move designed to attract capital into productive sectors of the economy and promote sustainable growth.
Temi Popoola, GMD and Chief Executive Officer of NGX Group, highlighted the importance of the dialogue in helping market participants understand the reforms. “Reforms of this scale raise important questions for the market. Our priority is to keep the capital market attractive and forward-looking while supporting long-term growth,” Popoola said, noting that the engagement was critical to safeguarding investor confidence ahead of the implementation.
Umaru Kwairanga, Chairman of NGX Group, reiterated the exchange’s role as a trusted convener between policymakers and the market. He emphasized that proactive engagement ensures reforms are clearly communicated, market confidence is maintained, and Nigeria’s capital market remains competitive compared to other African economies. “Significant policy shifts must be clearly understood and calibrated to preserve market confidence. NGX facilitates this dialogue to ensure reforms translate into sustainable, long-term economic growth,” Kwairanga added.
The session also addressed technical concerns around determining base costs, prospective calculations from the Act’s commencement, and the treatment of cross-listed securities to prevent double taxation. Market participants praised NGX’s leadership in fostering investor confidence and ensuring the reforms are implemented in a way that supports Nigeria’s broader economic objectives, reinforcing the exchange’s commitment to a transparent and investor-friendly capital market.
Source: punch