Nigeria’s 2026 Tax Reforms: 50 New Exemptions to Support Low-Income Earners and Small Businesses
In a major move to ease the financial strain on Nigerians, the Presidential Fiscal Policy and Tax Reforms Committee has announced 50 new tax exemptions and reliefs designed to support low-income earners, average taxpayers, and small businesses. The reforms, which take effect from January 1, 2026, are part of the government’s effort to create a more equitable and business-friendly tax environment. Committee Chairman Taiwo Oyedele described the initiative as “one of the most people-focused tax reforms in Nigeria’s history.”
According to Oyedele, the 2026 tax reforms aim to reduce the pressure on Nigeria’s poor and productive sectors while improving compliance and simplifying tax administration. Through a statement shared on X (formerly Twitter), he explained that the goal is to make the system “fair, simple, and inclusive.” The measures are expected to promote economic productivity and strengthen trust between taxpayers and government authorities.
Among the key highlights, individuals earning up to the national minimum wage will be exempt from paying Personal Income Tax (PAYE). Those earning up to ₦1.2 million annually will also enjoy full tax relief. Small companies with turnovers below ₦100 million and total fixed assets under ₦250 million will pay zero percent in Company Income Tax (CIT). Similarly, basic food items, education materials, healthcare services, and rent will all be VAT-exempt, ensuring that essential goods remain affordable for the average Nigerian.
The reform also offers strong incentives for the private sector and startups. Agricultural businesses will enjoy a five-year tax holiday, while companies offering salary increases or transport subsidies to low-income workers will get 50% compensation relief. Oyedele emphasized that the reforms encourage growth and support sectors critical to Nigeria’s long-term economic stability, such as agriculture, manufacturing, and technology startups.
Beyond the fiscal changes, Oyedele launched an initiative to promote accurate public awareness about the new tax laws. He urged Nigerians to nominate credible social media influencers for a new “Influencing for Good” training program that will help combat misinformation about taxation. “Accurate information may travel slower,” Oyedele noted, “but it empowers everyone and earns lasting trust.” With the reforms set to begin in 2026, Nigerians can expect a more transparent, fair, and supportive tax system designed to boost prosperity for both citizens and businesses.
source: Nairametrics