The Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, Taiwo Oyedele, has clarified that small-scale investors in the capital market are fully exempted from paying capital gains tax, while the 2026 tax reform law is aimed at protecting low-income earners and increasing disposable income.
Oyedele made the disclosure at the Cowry Quarterly Economic Discourse themed “Nigeria in 2026: Will Politics Trump Economic Reform?” where he addressed concerns and misconceptions surrounding the new tax regime. According to him, the law provides automatic capital gains tax exemptions for individuals whose total proceeds from asset disposal do not exceed N150m, provided the gain is not more than N10m within 12 months.
“The law says everyone is entitled to an exemption on capital gains tax. If the proceeds are not more than N150m and the gain is no more than N10m in 12 months, the exemption is automatic, with no explanation and no conditions attached,” Oyedele said.
He added that pension fund administrators and real estate investment trusts also enjoy exemptions, provided the proceeds are reinvested. High-net-worth individuals only become liable to capital gains tax when they exit investments permanently without reinvesting.
“If a multi-billionaire sells shares worth N2bn and decides not to reinvest, then tax is payable. But if the proceeds are reinvested, the law allows that exemption. What you pay instead is a minimal transaction cost, which also stimulates market activity,” he explained.
Oyedele described Nigeria’s current capital gains tax framework as one of the most competitive globally, noting that it encourages reinvestment, liquidity, and growth in the capital market. He also assured investors that the committee is drafting implementation regulations to clarify grey areas, while any proposed amendments requiring legislative action will be forwarded to President Bola Tinubu for consideration.
The tax expert further noted that most young Nigerians investing in digital and virtual assets operate at very small scales, making taxation concerns largely misplaced. “These young people are not investing millions of dollars. They invest $50, $80, and $200. That is what adds up. Meanwhile, capital market investments offer better returns, even in dollar terms, and they are fully exempted,” he said.
Oyedele warned that misinformation has discouraged youth participation in the stock market, with many wrongly believing that investment returns attract up to 30 per cent tax. “If you ask young people on the street, they will tell you the stock market is taxed at 30 per cent because nobody is telling them they are exempted,” he said.
He also highlighted the broader objectives of the 2026 tax reform law, saying it seeks to stop the taxation of poverty, protect low-income earners, and ensure that Nigerians with a higher capacity to pay bear a fairer share of the tax burden. Under the new framework, Nigerians earning the national minimum wage are fully exempt from personal income tax, while the threshold for taxable income has been significantly raised after allowable deductions and reliefs.
“The N800,000 people talk about is taxable income, not gross income. By the time you remove deductions and allowances, that translates to about N1m to N1.2m gross income. And even at that, anyone earning the minimum wage pays no tax at all,” Oyedele said.
He recalled that nationwide data previously presented to the government showed that about 96 per cent of personal income tax in Nigeria came from low-income earners, a situation he described as inequitable and economically dangerous. “We were taxing poverty. That is not how a functional economy works,” he said.
