OPPOSITION to the new tax laws is intensifying, with many Nigerians warning that several provisions could negatively affect their earnings, while deepening disaffection against the government.
In July, President Bola Tinubu signed four bills into law, which included: the Nigeria Tax Bill 2024, the Nigeria Tax Administration Bill 2024, the Nigeria Revenue Service (Establishment) Bill 2024, and the Joint Revenue Board of Nigeria (Establishment) Bill 2024.
The new law, which will take effect in January 2026, will see salary earners who receive N1.3 milliion annually or below exempted from paying income tax. The tax law has reduced the company income tax (CIT) from 30 percent to 25 percent, while raising the capital gains tax from 10 percent to 30 percent.
Spearheaded by Mr Oyedele, a lawyer and ex-tax expert at Pricewaterhousecoopers (PwC), the tax laws will see more than one-thirds of workers in both the private and public sectors exempted completely from Pay As You Earn (PAYE).
However, despite the perceived benefits to the poor, Nigerians on X are pointing out various grey areas in the laws. A financial analyst, Mr JP Attueyi, with a handle @jpattueyi, said: “One of the most dangerous parts of the new tax law isn’t the tax itself. It’s how the amount can be decided without you. Under the new framework, if you fail to file, keep proper records, or respond on time, the tax authority is allowed to assess you based on its own information and judgment.”
He called it ‘a best-of-judgment (presumptive) assessment,’ noting that the assessment did not have to be perfect but only had to be reasonable from the taxman’s point of view.
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“And once that assessment is raised, penalties start running, interest starts compounding, the burden shifts to you to disprove it. Not the other way around. If your records are weak, your income looks larger than it was. If your expenses aren’t documented, they don’t exist. If context is missing, the law fills the gap with assumptions.
“This is why silence is expensive. Many people think: ‘I’ll explain when they ask.’ But under the new regime, by the time you’re explaining, the numbers may already be locked in and growing. Once the law switches from self assessment to presumptive assessment, you’re no longer negotiating facts, you’re fighting a losing battle.”
“And if you choose to go to court, you will have to deposit 20 percent of their assessment first. This law makes the taxman very powerful,” he added.
An X user, @Morris_Monye, who is an investor, wrote: “Tax Nigerians like Norway but rule the people like South Sudan.”
Another X user, @Peteriyke197, responded: “It is unbelievable. Norway, and the rest of the Scandinavian countries like Denmark, Iceland, Finland, Sweden, et al, practice a ‘cradle to grave’ taxation policy. A system that provides extensive social support throughout a person’s life: from childcare and education (cradle) to healthcare, unemployment benefits, pensions, and elderly care (grave). These systems are typically funded by high progressive taxes and aim for universal coverage, reducing inequality and poverty.”
He said that in Nigeria, however, citizens were taxed from cradle to grave, noting that, “you will get next to nothing for all the taxes you pay. Nothing, but more taxation till you bleed through your eyes.”
On Wednesday, a member of the House of Representatives, Mr Abdussamad Dasuki, alleged that there were discrepancies between the tax reform laws passed by the National Assembly and the gazetted copy available to the public.
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Dasuki, who represents Kebbe/Tambuwal federal constituency of Sokoto, raised a point of privilege on the floor of the lower legislative chamber during Wednesday’s plenary.
Reacting to the legislator’s submission, an X user,@Aliyu_abm, wrote: “Nigerians need to talk about this: The tax law gazetted is reportedly different from what was actually discussed in Parliament regarding the MoU. This is not a small clerical error, it’s a possible alteration of law after it was passed. We cannot stay silent.”
Another X user, @Akin_Malaolu, responded, saying: “Tinubu has by his own hands halted the implementation of the Tax laws. He was alleged to have tampered with the final drafts passed by the National Assembly thereby making the laws Gazzetted to become null and void. So sad that Tinubu could play lawmakers role. Very strange.”
However, an X user, @Sholabaggio, hailed the tax laws, saying that, “You don’t pay tax on what you don’t have (e.g if a particular tagged amount does not enter your account, \you won’t pay shi shi).”
A financial analyst, Mr Odinchelu Chima, said there were several misconceptions in the tax laws which were simply untrue. He cited an example with the company income tax (CIT), which had been reduced from 30 percent to 25 percent, saying that this aspect of the tax laws should be celebrated by Nigeria’s corporate community.
“We have to criticise when we have to, but also commend the government when it does what is right. Are we saying the reduction in CIT is not front page news in the media? If you have this kind of thing in the western world, you would have bold headlines. But, for us, it is bad news.”
