Abuja: The Independent Media and Policy Initiative (IMPI) has revealed that the Nigeria Tax Act 2025 is set to enhance foreign investment and empower Small and Medium-sized Enterprises (SMEs). This was disclosed in a policy statement signed by the group’s Chairman, Dr. Omoniyi Akinsiju.
According to News Agency of Nigeria, the law, which will come into effect in January 2026, introduces provisions that eliminate double taxation and encourage business expansion. Akinsiju highlighted that with the implementation of the Nigerian tax laws, foreign direct investment inflows into the country are expected to be revitalized.
Akinsiju further explained that the new law brings clarity, a lower effective tax rate, and eliminates dividend double taxation. He noted that the normal company income tax rate on large companies in Nigeria is 30 per cent of the company’s profit. However, with the adoption of the Minimum Effective Tax Rate (ETR), Nigerian companies that are part of a multinational group with an aggregate group turnover of 750 million euros and above, or have an annual turnover of 50 billion Naira and above, will now be subject to a minimum ETR of 15% of their net income. This aims to prevent the double taxation of dividends and unrealized gains or losses, which will likely influence the flow of global capital to Nigeria.
Akinsiju also stated that the Act will improve Nigeria’s ease of doing business. The tax exemption threshold for selling company shares in Nigerian companies has been increased to 150 million Naira, provided the gains do not exceed 10 million Naira. This is seen as another ease-of-doing-business policy.
The law is expected to benefit local businesses, particularly SMEs, through tax reliefs resulting from simplified compliance and a reduction in the tax burden on businesses, especially Micro, Small, and Medium Enterprises (MSMEs). This will foster a more favorable environment for business expansion and job creation.
Akinsiju emphasized that the Tinubu tax reforms could reshape Nigeria’s economy significantly. He stated that these reforms, alongside the removal of fuel subsidies and the harmonization of foreign exchange transaction windows, are crucial for resetting the Nigerian economy on a sustainable and inclusive growth path.
