An Abuja High Court has cleared the way for the implementation of Nigeria’s new tax regime scheduled to commence tomorrow, Thursday, January 1, 2026, as it dismissed a suit seeking to halt the exercise.
The ruling gives the federal government, the Federal Inland Revenue Service (FIRS) and the National Assembly full legal backing to proceed with the take-off of the new tax laws.
The suit was filed by the Incorporated Trustees of African Initiative for Abuse of Public Trustees, which dragged the Federal Republic of Nigeria, the President, the Attorney-General of the Federation, the President of the Senate, the Speaker of the House of Representatives and the National Assembly before the court over alleged discrepancies in the recently enacted tax laws.
In an ex parte motion, the plaintiff sought an interim injunction restraining the federal government, FIRS, the National Assembly and related agencies from implementing or enforcing the provisions of the Nigeria Tax Act, 2025; Nigeria Tax Administration Act, 2025; Nigeria Revenue Service (Establishment) Act, 2025; and the Joint Revenue Board of Nigeria (Establishment) Act, 2025, pending the determination of the substantive suit.
The group also asked the court to restrain President Bola Tinubu from implementing the laws in any part of the federation pending the hearing of its motion on notice.
However, in a ruling delivered on Tuesday, Justice Kawu struck out the application, holding that it lacked merit and failed to establish sufficient legal grounds to warrant the grant of the reliefs sought.
The court ruled that the plaintiffs did not demonstrate how the implementation of the new tax laws would occasion irreparable harm or violate any provision of the Constitution, stressing that matters of fiscal policy and economic reforms fall squarely within the powers of government.
Recall that Mr Tinubu had ignored suspension calls and insists the new tax laws will take off tomorrow.
Justice Kawu further held that once a law has been duly enacted and gazetted, any alleged errors or controversies could only be addressed through legislative amendment or a substantive court order, noting that disagreements over tax laws cannot stop the implementation of an existing law.
Consequently, the court affirmed that there was no legal impediment to the commencement of the new tax regime and directed that implementation should proceed as scheduled from January 1, 2026.
The new tax regime is anchored on four landmark tax reform bills signed into law in 2025 as part of the Federal Government’s broader fiscal and economic reform agenda aimed at boosting revenue, simplifying the tax system and reducing leakages.
The laws — the Nigeria Tax Act, 2025, Nigeria Tax Administration Act, 2025, Nigeria Revenue Service (Establishment) Act, 2025, and the Joint Revenue Board of Nigeria (Establishment) Act, 2025 — consolidate and replace several existing tax statutes, including laws governing companies income tax, personal income tax, value added tax, capital gains tax and stamp duties.
Key elements of the reforms include the harmonisation of multiple taxes into a more streamlined framework, expansion of the tax base, protection for low-income earners and small businesses, and the introduction of modern, technology-driven tax administration systems such as digital filing and electronic compliance monitoring.
The reforms also provide for the restructuring of federal tax administration, including the creation of the Nigeria Revenue Service, to strengthen efficiency, coordination and revenue collection across government levels.
The Tinubu administration has said the reforms are critical to stabilising public finances and funding infrastructure and social services, however recent allegations of discrepancies between the versions passed by the National Assembly and those later gazetted has raised a few eyebrows including former Vice President Atiku Abubakar and the Nigerian Bar Association (NBA).