The Executive Chairman of the Nigeria Revenue Service (NRS), Dr Zacch Adedeji, has moved to calm rising public anxiety over the newly implemented tax reforms, insisting that neither the old tax regime nor the new laws empower any authority to tax money sitting in Nigerians’ bank accounts.
Naijaonpoint reports that Adedeji made the clarification on Tuesday while speaking on Journalists’ Hangout, a current affairs programme aired on TVC, amid widespread rumours that the new tax laws could trigger automatic deductions from personal and corporate bank accounts.
The revenue chief stressed that taxation in Nigeria is strictly tied to profits and returns, not assets or savings.
“Whether old tax law or new tax law has nothing to do with your personal bank account, whether you’re a company or you are an individual,” he said.
“Don’t forget that tax is a percentage of your profits. So if you have an asset, the asset is not to be taxed. We only tax the profits. We only tax the return.”
His comments come against the backdrop of claims that transfers, account narrations or balances could expose individuals to tax deductions following the commencement of the reforms on January 1, 2026.
Adedeji dismissed the claims as misinformation, maintaining that there is no legal provision that allows tax authorities to dip into bank accounts simply because money is transferred or retained.
“There is no law that allows anybody to go into your bank account and tax you because you transfer money or you keep money,” he said.
According to him, personal transfers, gifts, and movements of funds between accounts are not taxable by default.
“If you transfer money from your account to my brother, that is a personal transaction between both of you. It has nothing to do with tax authority, whether at the state level or at the federal level,” he added.
He also rejected the notion that banks could be instructed to debit customers’ accounts for tax purposes based on transaction descriptions.
“There’s no such provision in any tax act. Whether you describe it or you don’t put any description, tax law, both the old law or even the new law that we have now has not given anybody any right to come into your personal account and tax you and instruct the bank to debit you,” Adedeji said.
The revenue boss explained that the transition from the Federal Inland Revenue Service to the Nigeria Revenue Service goes beyond a name change, describing it as a fundamental institutional overhaul aimed at simplifying compliance and modernising tax collection.
He noted that transition provisions were built into the law signed in June, with a January 1, 2026, commencement date, in line with national tax policy principles that allow time for adjustment.
According to him, early market signals suggest that the reforms are already yielding positive responses, though he did not provide specific figures.
He urged Nigerians to judge the reforms based on facts rather than speculation.
“You can see now that we are on the 13th of January, all those myths… You can see that those things were nowhere to be found,” he said.
Development Levy Not A New Tax
Addressing one of the most controversial aspects of the reform, Adedeji clarified that the development levy is not a new tax but a consolidation of several existing earmarked taxes.
“Before now, we have what we call earmarked taxes. You have education tax, you have police trust fund… which makes it very difficult for businesses to plan,” he said.
“But with this one item, which we call development tax, which is the summation of all these earmarked taxes… it is a consolidation of all the earmarked taxes that we are paying already today into one to simplify compliance.”
He said the consolidated levy would continue to support education and other development priorities, including security.
Adedeji insisted that the reforms were deliberately structured to reduce the burden on poorer Nigerians, noting that essential items that account for most low-income spending are exempt from transactional taxes.
“If you look at the exemption list, 90 per cent of the disposable income of poor people is on food and transport,” he said.
“If you look at the tax acts, all these are exempted from transactional taxes, food, and transportation.”
He added that low-income salary earners would notice reduced tax deductions in their January pay.
“By the time the salary is being paid by this end of January, the salary earner in that lower cadre will confirm compared to what they’ve paid under the old law,” he said.
‘No Room For Suspension Of New Tax Law’
Responding to calls for a suspension of the new tax laws, Adedeji said such demands had no place in a democracy.
“The suspension of law has no place in a democratic setting. When law is passed, it becomes law,” he said, warning that suspension would create a legal vacuum since the old tax laws had been repealed.
On criticisms attributed to KPMG, the revenue chief said the government favoured engagement rather than confrontation, revealing that he had met with the firm to address concerns.
“It is expected that people either don’t understand all, they don’t have the context, or they misinterpret what they read because it is new,” he said, adding that feedback was welcome to improve implementation.
Adedeji clarified that existing tax clearance certificates remain valid and that withholding tax is a prepaid tax, not an additional burden.
“When the tax is being withheld… it’s a prepaid tax of the taxpayer,” he said, adding that proper filing would reduce final liabilities.
He also reiterated that digital asset activities would be taxed only on profits, not capital, noting that the reforms removed minimum tax provisions that required payments even when businesses recorded losses.
“On losses, you don’t pay tax. Because tax is only on profits,” he said.
According to him, the broader goal of the reforms is to harmonise Nigeria’s tax system, reduce manual processes and rely more on technology and revenue intelligence.