The Lagos Chamber of Commerce and Industry says effective and transparent implementation of the Tax Reform Act is critical to simplifying compliance, reducing the burden on productive enterprises and broadening the tax base without stifling economic growth.

The body called on the Federal Government to ensure its implementation.

In a statement reviewing the country’s economic performance in 2025 and outlining priorities for 2026, the Chamber’s President, Leye Kupoluyi, noted that fiscal reforms gained momentum with the signing of the Tax Reform Act in June 2025, which consolidated multiple tax laws into a unified framework scheduled to take effect from 1 January 2026.

“Effective and transparent implementation of the Tax Reform Act is essential to simplify compliance, reduce the burden on productive enterprises, and broaden the tax base without stifling growth,” Kupoluyi stated.

The LCCI’s statement follows the recent television interview by the Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, Taiwo Oyedele, who clarified that Nigerians would not face automatic deductions from personal bank accounts as the new tax laws take effect on 1 January 2026.

The PUNCH reported that Oyedele affirmed that the new tax system is based on self-declaration and not direct debits. He said, “People think that the government will debit their bank accounts from next year, and how they even came up with that, I have no idea. Nobody will debit your account for any amount you transfer. Whether it’s N1bn or N1,000, at the end of the year, you tell the government yourself.”

The chamber noted that Nigeria entered 2026 after a year of “tough reforms, economic resilience, and cautious stabilisation.” It referred to 2025 as marked by modest growth recovery, constrained fiscal execution and rising concerns over debt sustainability.

It acknowledged that difficult adjustments followed the removal of fuel subsidies, foreign exchange liberalisation and aggressive monetary tightening, which imposed “significant short-term pain on households and businesses”, but added that the measures laid the foundation for restoring macroeconomic credibility and rebuilding investor confidence.

Reviewing economic indicators, the LCCI noted that the growth of the Gross Domestic Product strengthened modestly in 2025, with output expanding by 3.98 per cent in the third quarter, driven largely by the services sector, which now accounts for over half of national output.

It added that Nigeria’s exit from the Financial Action Task Force grey list marked a major reputational boost, improving access to global capital, as reflected in an oversubscribed Eurobond issuance and a positive rating by S&P Global.

However, the chamber warned that growth remained insufficient to lift incomes or significantly reduce poverty. “This performance remains below Nigeria’s population growth rate, underscoring that current growth is not inclusive,” the statement said.

The LCCI also criticised the 2025 budget implementation, stating that it failed to deliver the scale of fiscal stimulus needed to support recovery. As of the third quarter of 2025, revenue stood at N18.6tn, about 61 per cent of the target, while expenditure reached N24.66tn, or 60 per cent.

It expressed concern that capital budget implementation remained weak, with only N3.10tn, representing 17.7 per cent, released by Q3, limiting infrastructure delivery and private sector confidence.

On public finance, the chamber described Nigeria’s debt position as troubling, noting that total public debt increased to about N152.39tn in June 2025, while debt servicing consumed over 65 per cent of government revenue.

“This severely limits the government’s capacity to fund infrastructure, social services and growth-enhancing investments,” it said, adding that revenue expansion and prudent borrowing were “non-negotiable”.

The LCCI noted that businesses continued to face major headwinds in 2025, including high inflation, foreign exchange volatility, insecurity in food-producing regions, persistent power shortages and multiple taxation.

Looking ahead to 2026, the chamber urged stronger coordination between fiscal and monetary authorities to entrench disinflation and gradually ease interest rates, boosting private sector credit.

It also called for deeper confidence in the foreign exchange market, accelerated infrastructure development through public-private partnerships and policies that deliberately promote inclusive growth.

The LCCI stated that 2025 marked a turning point from crisis management to cautious stabilisation, adding that “the challenge for 2026 is to move beyond stability and translate macroeconomic reforms into broad-based prosperity.”