…says women still face structural disadvantages
A development economist and fiscal governance expert, Professor Chiwuike Uba, has commended the signing into law of the tax reform bills.
Describing the reforms as a historic opportunity to rebuild fiscal compact, promote equity as well as restore public trust, he said Nigeria’s tax system had long been a microcosm of the country’s wider governance dysfunction—characterised by a narrow tax base, over-taxed wage earners, chronically under-taxed elites, a vast informal sector, and public mistrust rooted in decades of poor service delivery and corruption.
He, however, lamented that despite its ambitions, the reform package lacked gender-sensitive provisions.
According to him, “women-led enterprises and informal traders remain exposed to regressive levies and face structural disadvantages. There are no targeted tax credits or reliefs for women, nor for Nigeria’s 30+ million persons with disabilities, senior citizens, or other vulnerable groups.”
Uba, who is the Chairman of the Board, ACUF Initiative for Policy and Governance, in a report made available to New Telegraph, said with a tax-to-GDP ratio of just 6–8 per cent, Nigeria ranked among the lowest in Africa and the world.
He said: “Against this backdrop, the passage of four groundbreaking tax laws in 2025—the Nigeria Tax Act, the Tax Administration Act, the Nigeria Revenue Service (Establishment) Act, and the Joint Revenue Board (Establishment) Act—offers an unprecedented opportunity to shift from extractive taxation toward progressive, inclusive, and transparent fiscal governance.”
Describing it as a bold shift toward progressivity and equity, he pointed out that for the first time in history, Nigerians earning ₦800,000 or less annually were exempt from personal income tax while Small and medium enterprises (SMEs) with a turnover below ₦25 million are enjoy a zero per cent company income tax rate.
“These reforms reflect a long-awaited shift toward progressivity, compassion, and economic justice. However, their success depends on diligent implementation, digital onboarding, and fairness in enforcement,” he said.
He also commended the aspect of digital intelligence and modern enforcement, saying that digitization is now a statutory requirement.
According to him, “mandatory Taxpayer Identification Numbers (TINs) are linked to national identity systems (NIN, BVN, CAC), enabling real-time filing, AI-powered audits, e-invoicing, and automated VAT tracking.
“These reforms have the potential to drastically improve tax efficiency, reduce fraud, and enable evidence-based revenue monitoring.”
On harmonisation and protection for tax payers, he hailed the fact that the Joint Revenue Board has now been empowered to unify federal, state, and local tax systems, while states can delegate collection to the Nigeria Revenue Service.
“The establishment of the Office of the Tax Ombud provides a new legal platform for dispute resolution and taxpayer protection. If implemented faithfully, these reforms can eliminate multiple taxation, foster accountability, and restore dignity to the taxpayer experience,” he added.
He further said that the reforms boldly extended Capital Gains Tax to digital and intangible assets such as cryptocurrency, NFTs, and intellectual property, adding that Withholding Tax compliance has been strengthened and expanded to cover digital transactions, consultancy, rents, and more. These measures mark a significant step toward taxing capital, not just consumption and labour.
On multinational tax avoidance and transfer pricing reforms, he recalled that Sections 190–195 of the Nigeria Tax Act fortified anti-avoidance rules and transfer pricing enforcement.
“They mandate arm’s-length pricing for related-party transactions and empower revenue authorities to audit offshore profit-shifting schemes. These provisions align Nigeria with global BEPS (Base Erosion and Profit Shifting) efforts and signal a shift toward corporate tax justice,” he added.
For social protection, Uba also affirmed that exemptions must be complemented with integration into broader systems—linking tax IDs with the National Social Register, health insurance schemes, and cash transfers, adding that tax justice must be accompanied by social equity, especially in a country with deep spatial and gendered inequalities.
“The Tax Administration Act introduces refund provisions, but lacks specific timelines and automation protocols. In a context of low institutional trust, this may discourage compliance and penalise exporters and manufacturers. Furthermore, Nigeria still does not require the annual publication of a tax expenditure report—leaving the true cost of waivers and incentives hidden from public view.
“Many local governments lack broadband, digital systems, and skilled tax personnel. Without digital readiness grants, the reforms risk deepening subnational inequality. States like Lagos and Kaduna may flourish, while others lag behind. Moreover, political interference in the appointment of tax agency leadership undermines institutional independence and policy continuity.
“To win public trust, tax must be visibly linked to service delivery. Citizens should be able to trace how their taxes fund public goods—roads, schools, healthcare. Nigeria must implement budget-tagging, digital transparency platforms, and participatory budgeting frameworks that allow citizens to track and influence how their taxes are spent.
“While harmonisation is a goal, Nigeria’s unresolved fiscal federalism—particularly disputes over VAT and derivation—must be addressed to ensure cohesion and fairness. A formal Intergovernmental Fiscal Coordination Council is recommended to align national and subnational tax regimes and avoid future litigation or political fragmentation.
“The reforms pave the way for Nigeria to adopt OECD tax standards, including digital services taxation and global minimum tax rules. However, more effort is needed to integrate the diaspora—through diaspora bonds, overseas investment-linked tax credits, and alignment with FATCA and the Common Reporting Standard (CRS).
“With over 60 per cent cent of economic activity in the informal sector, and youth dominating digital microenterprises, the article calls for a youth tax transition scheme. This would offer tax holidays in exchange for digital onboarding, as well as presumptive tax options and mobile-based registration.
“While the Tax Appeal Tribunal and Ombud exist, Nigeria’s judiciary is overburdened and under-resourced. To ensure fair and timely resolution of tax disputes, investment in judicial capacity—particularly at the state level—is imperative.
“The introduction of a five per cent fossil fuel surcharge is a step toward environmental accountability. Nigeria must expand this into a full green taxation framework, including carbon pricing, eco-levies on extractive industries, and a National Green Fund supported by environmental tax receipts.
“By linking TINs to financial records, public procurement data, and AI-enabled audit systems, the reforms offer a new frontier in anti-corruption. Annual tax filings could be cross-referenced with asset declarations to identify illicit wealth. Transparency must extend to the top, not just the bottom.
“There is a need for simplified tax guides, visual rate charts, mobile apps, and physical support channels—especially for the elderly, persons with disabilities, and digitally excluded citizens. Without these, even well-meaning reforms could exclude the most vulnerable.”
“The 2025 tax reform laws represent not just new rules, but a new opportunity.
“An opportunity to make taxation an instrument of justice and development. An opportunity to restore the dignity of the taxpayer. Nigeria has written the laws. Now it must write the legacy,” he added.
