The Federal Government will forgo about N1.4 trillion in revenue in 2026 by reducing the corporate income tax rate from 30% to 25%, according to Taiwo Oyedele, Chairman of the Presidential Fiscal Policy and Tax Reforms Committee. The move is part of a broader tax reform framework aimed at stimulating economic growth.
Oyedele explained that sustainable revenue depends on economic expansion, not higher tax rates, and said the reforms avoid introducing new taxes. The reduction will allow businesses to retain more capital and support job creation.
The reforms also include changes to the Value Added Tax regime, allowing companies to claim input VAT credits on assets, overheads, and services previously excluded. This is expected to lower production costs for key sectors like food, education, and healthcare.
Also Read: FG Merges Capital Gains Tax with Corporate Tax
The new tax laws, effective January 1, 2026, are designed to simplify the system, broaden the tax base, and enhance compliance. President Bola Tinubu has approved the National Tax Policy Implementation Committee to drive the reforms, chaired by tax expert Joseph Tegbe.
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