Grace Adeleke
The Federal Government has commenced a six-week review of Nigeria’s new tax laws, with the Minister of Finance and Coordinating Minister of the Economy, Wale Edun, mandating a technical subcommittee to identify implementation challenges, unintended consequences and areas requiring clarification.
The exercise is expected to feed into the Finance Bill 2027, as the government seeks to make the country’s emerging tax regime clearer, simpler, more predictable and competitive without reversing the fundamental architecture of the reforms.
The development was announced on Thursday in Abuja during the inauguration of the Technical Subcommittee on Fiscal Policy and Tax Reforms.
Speaking at the inauguration, the minister said the review was necessary to ensure that the new tax framework delivered its intended objectives without creating avoidable burdens for taxpayers, businesses and investors.
According to him, the government’s tax reforms culminated in four major pieces of legislation which came into full effect on January 1 — the Nigeria Tax Act, Nigeria Tax Administration Act, Nigeria Revenue Service Establishment Act and Joint Revenue Board Establishment Act.
Edun said the next phase should focus on making the reforms work effectively rather than reopening the fundamental principles upon which they were built.
He said, “The bill must respond to implementation challenges, unintended consequences and emerging economic realities.”
The minister said the government had received 134 submissions from stakeholders across Nigeria’s six geopolitical zones following its call for inputs into the Finance Bill 2027.
He said the submissions covered issues including the simplification of tax laws, multiple taxation, digitalisation, data sharing, taxpayer rights, tax refunds, small businesses and investment competitiveness.
Edun charged members of the subcommittee to subject the submissions to objective assessment, stressing that recommendations must be driven by evidence, national interest and their likely impact on the economy.
He warned against an exclusive focus on revenue generation, saying fiscal policies should also stimulate investment, manufacturing, productivity, formalisation and value creation.
The minister further urged the committee to consider the effects of tax measures on low-income households, workers, small businesses, women and young people.
He said the government was particularly interested in reducing compliance costs and opportunities for tax arbitrage while ensuring that the system remained fair and efficient.
As part of its mandate, the subcommittee is expected to review the Deduction of Tax at Source Regulations 2024 against the provisions of the new tax laws and prepare revised withholding tax regulations.
Edun stressed that withholding tax was designed primarily as an advance-payment and compliance mechanism.
The committee will also review the Companies Income Tax (Significant Economic Presence) Order 2020 and develop an updated framework aligned with the new tax laws and international best practices.
Explaining the importance of the exercise, the minister said Nigeria must preserve its taxing rights while ensuring that its tax environment remained attractive to technology companies and cross-border investors.
He said, “The country must protect its taxing rights while remaining competitive for technology and cross-border investments.”
Edun gave the subcommittee six weeks to complete its assignment and submit its report.
The exercise will involve the Federal Ministry of Finance, Ministry of Justice, Nigeria Revenue Service, Joint Revenue Board, Nigeria Customs Service and the Small and Medium Enterprises Development Agency of Nigeria, alongside private-sector representatives and professional bodies.
The minister directed the Ministry of Justice to participate throughout the drafting process rather than waiting until the documents had been completed before reviewing them.
He also instructed members to maintain confidentiality during deliberations and declare any conflicts of interest.
Edun urged the members to approach the assignment from the perspective of national interest rather than narrow institutional considerations.
According to him, the first phase of the reform changed the architecture of the tax system, while the next phase should focus on making the system function more effectively.
He said the success of the exercise should be judged by the number of genuine problems resolved rather than the number of legislative provisions altered.
The minister therefore urged members to listen widely, challenge assumptions, scrutinise evidence and maintain objectivity throughout the six-week exercise.
Also speaking at the inauguration, the co-chairman of the technical subcommittee, Albert Folorunsho, assured the minister that members would work to deliver the assignment within the stipulated period.
Folorunsho, who is also chairman of the Tax Advisory Committee, said the subcommittee would prepare the Finance Bill 2027, review the withholding tax regulations and examine the significant economic presence order.
He described the assignments as critical to building a tax system that is fair, clear, efficient and capable of supporting investment.
Folorunsho said the committee’s recommendations would be “technically sound, administratively practicable and responsive to taxpayers, businesses and government.”
While acknowledging that the six-week deadline was demanding, he expressed confidence that the experience and commitment of members would enable them to complete the assignment on schedule.
He said the committee would consult widely with relevant stakeholders and pursue measures capable of strengthening revenue mobilisation without imposing unnecessary burdens on taxpayers.
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