The Chairman of the Presidential Fiscal Policy and Tax Reforms Committee, Taiwo Oyedele, has revealed that Nigerians who earn N100m and above monthly, will face a 25% personal income tax rate.
This will happen if a new tax bill is passed by the National Assembly.
Oyedele stated that 90% of the current taxpayers are people who should not be taxed while advocating for a more streamlined and equitable tax system in the country.
This revelation was made during a breakout session at the ongoing 30th Nigeria Economic Summit organised by the Nigerian Economic Summit Group and the Ministry of Budget and National Planning on Monday in Abuja.
Oyedele emphasised the need to strike a balance between easing the tax burden for lower-income earners and ensuring the wealthy contribute more to government revenue.
“If you earn N100m a month, we are taking up to 25 per cent from the rich people. That’s because we need to balance the books,” Oyedele stated.
The fiscal policy expert said the government is prepared and determined to ensure that the right individuals pay taxes, noting that his committee is actively working to achieve the goal.
He added that the proposed changes are expected to take effect from January 2025, based on the passage of the bill by lawmakers.
For middle-income earners making N1.5m or less per month, Oyedele disclosed that their personal income tax obligations would decrease while those earning higher amounts would see incremental increases in their tax rates, eventually reaching 25 percent. Lower-income earners would be fully exempt from personal income tax.
The reforms also aim to ease the tax burden on businesses.
Oyedele noted: “Today, whatever VAT you (businesses) pay on assets—whether you’re building a factory, buying a laptop, or vehicles—you bear it. This increases your cost, and therefore, your pricing will go up. Once our reforms are implemented, you get the credit back 100 percent on services and assets.”