The Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, Taiwo Oyedele, has stated that under the country’s new tax laws, set to come into effect from January next year, Nigeria’s Company Income Tax (CIT) rate will drop to 25 percent from the current 30 percent..
Oyedele, who disclosed this at a special media workshop in Lagos on Friday, said that the reduction in the CIT rate will boost Foreign Direct Investment (FDI) inflows and also positively impact domestic business expansion.
He also said that the CIT reduction is part of a comprehensive reform package aimed at simplifying the tax system and easing the burden on vulnerable individuals, adding that some of the benefits of the new tax laws include zero percent CIT for small & medium-sized companies, simplified returns, simplified and business-friendly capital allowance regime.
Oyedele noted that the current tax system is inconducive for growth as it places excessive tax burden on businesses. He argued that under the current tax system, the country taxes poverty, capital, and investments using archaic laws and ambiguous provisions.
He stressed that, despite misconceptions about the new tax laws circulating on social media, the new laws do not empower either the Federal Inland Revenue Service (FIRS) or the Central Bank of Nigeria (CBN), or any government agency to unilaterally withdraw funds from personal or business bank accounts.
While noting that false narratives could lead to panic withdrawals and destabilise the economy, Oyedele declared that “nobody will debit the accounts. Even if you have N1 billion in the account, nobody can debit your bank account.”
He explained that under the new tax law, Nigeria’s tax administration process requires notification, assessment, objection, and judicial review before any enforcement action can be taken.
According to him, the only scenario where the law permits the government to request bank deductions is in extreme cases, involving large tax debts that have gone through all legal channels.
“It will not apply to anyone that I know of in Nigeria,” he added, emphasising that the provision exists merely as a safeguard, not a routine tool. He also clarified that the requirement for Tax Identification Numbers (TINs) in bank accounts is not new, as it dates back to the Finance Act of 2020.
