Hardly a day now passes without Nigerians discovering a new reason to worry about tax. In cafés in Abuja and co-working spaces in Lagos, the conversation has shifted from runway and valuations to gazettes and certified true copies. The country’s most ambitious tax overhaul in decades is meant to simplify life. Instead, it has produced a familiar Nigerian outcome: confusion, suspicion and a paperwork arms race.
At the centre of the storm are four tax reform laws signed by President Bola Tinubu in June 2025 — billed by the government as a long-overdue modernisation of Nigeria’s revenue system and scheduled to take effect on January 1, 2026. Critics, however, argue that the laws Nigerians are reading may not be the laws lawmakers passed.
That distinction matters.
The forgery allegations that won’t go away
In late December, Abdulsammad Dasuki, a member of Nigeria’s House of Representatives, made an uncomfortable allegation. The tax laws gazetted by the government, he claimed, contained provisions that lawmakers never debated or approved. Entire sections had allegedly been inserted, removed, or altered after legislative passage — a constitutional violation of the highest order.
The accusations are detailed and specific. According to civil society organisations including the Resource Centre for Human Rights and Civic Education (CHRICED) and the Socio-Economic Rights and Accountability Project (SERAP), the gazetted versions now include powers allowing tax authorities to seize funds without court orders, a requirement for taxpayers to pay 20% of disputed assessments upfront before appeals, and a mandate to use US dollars as the sole currency for certain tax computations.
Section 27(2) of the harmonised bill, which dealt with capital allowances for priority sector companies, was allegedly expunged entirely from the official gazette. Section 172, concerning production day certification and qualifying capital expenditure, was substantially rewritten. The changes weren’t trivial copyedits; they fundamentally altered the law’s scope and enforcement mechanisms.
Taiwo Oyedele, chairman of the Presidential Fiscal Policy and Tax Reforms Committee, dismissed the controversy with the kind of bureaucratic jujitsu that would impress Kafka. “Before you can say there is a difference between what was gazetted and what was passed, we have what has not been gazetted. We don’t have what was passed,” he told Channels Television, somehow managing to say everything and nothing simultaneously.
His position: the versions circulating in the media are fake. The official harmonised bill certified by the National Assembly clerk — the only version that matters — hasn’t been publicly released for comparison. Therefore, nobody can authoritatively claim anything was changed. It’s a masterclass in plausible deniability.
CHRICED was less diplomatic. “These are not mistakes. These are acts of impunity,” the organisation stated, calling for an independent investigation, immediate suspension of implementation, and prosecution of any officials found culpable.
The Presidency and Senate, notably, have remained silent. The Speaker of the House established a seven-member ad hoc committee to investigate, which CHRICED described as “the start, not the end, of accountability.”
What the law (probably) says
Setting aside the existential question of which version is real, the tax reforms represent the most ambitious overhaul of Nigeria’s fiscal system in decades. The government aims to boost the country’s tax-to-GDP ratio from below 10% to 18% within three years — an aggressive target for a country where, according to the Strategic Engagement and Intelligence Division (SEID), less than 0.4% of the population earns above ₦1 million annually.
For Nigeria’s dollar-earning tech ecosystem, the reforms introduce several uncomfortable realities:
Personal Income Tax has been restructured with a new tax-free threshold of ₦800,000 annually. Above that, rates range from 15% to 25% on a progressive scale. A mid-level software developer earning ₦6 million annually would face a tax bill of ₦930,000 — assuming they declare accurately and voluntarily, which brings us to the government’s real enforcement strategy.
Worldwide income taxation now applies to Nigerian residents. Spend more than 183 days in the country, and your global earnings become taxable. The government offers a tax credit for taxes paid abroad, but the burden of proof sits with the taxpayer. For the thousands of Nigerians earning from European or American companies while living in Lagos, this represents a significant compliance headache.
Capital and digital gains are no longer off-limits. Crypto traders, startup investors, and anyone making money from digital assets must now declare net gains. Losses can be offset against gains — a small mercy — but those with net gains exceeding ₦10 million will be taxed accordingly.
Oyedele has been refreshingly blunt about enforcement. “If you are a remote worker, you are a worker,” he stated at a recent event. “The obligation falls on you to self-declare… If you now refuse to declare, the government will see the movement of the money, and they will deem it as your income, charge you tax on it, add a penalty, and interest for the late payment.”
Translation: they’re watching, and they will assume the worst.
The withholding tax trap
Running parallel to the main reforms is a quieter but equally consequential mechanism: the Deduction of Tax at Source (Withholding) Regulations, 2024, gazetted in October. This requires businesses and payment platforms to deduct tax before money reaches recipients.
In theory, withholding tax is an advance payment that gets credited against final annual liability. In practice, it creates a paperwork nightmare that feels exactly like double taxation.
Consider a freelancer earning $5,000 from a US client through a Nigerian payment platform. The platform withholds 10% ($500) immediately. At year-end, the freelancer must declare the full $5,000 as income and pay personal income tax on it. The $500 withheld is supposed to be creditable against the final bill, but claiming it requires navigating Nigeria’s tax bureaucracy — a process that makes filing US taxes look straightforward.
Compounding the anxiety is the Federal Inland Revenue Service’s aggressive use of “Best of Judgement” assessments. Lacking clear data, tax officials essentially guess liability based on perceived lifestyle — a founder’s car, their office location, their social media presence. Tayo Oviosu, founder of fintech giant Paga, recently protested a personal income tax bill that exceeded his entire year’s earnings, highlighting the system’s capriciousness.
The logic is circular and punishing: tax is withheld at source, then you’re assessed separately based on lifestyle, and to dispute the assessment, you must open your private books to prove your actual income. All this despite having already had taxes deducted before you saw the money.
An ecosystem already on the ropes
The timing could hardly be worse. Nigeria’s tech sector, once Africa’s most dynamic, is in freefall. According to Launch Base Africa, Nigerian startups raised just $156.6 million in the first half of 2025, compared to $1.2 billion for the full year of 2022. The country has slipped to fourth place on the continent for venture capital funding, behind South Africa, Egypt, and Kenya.
Tinubu’s economic reforms — floating the naira, removing fuel subsidies — were meant to stabilise the economy. Instead, the naira collapsed, inflation surged past 30% (before it was controversially rebased), and multinational corporations fled. Microsoft, Unilever, and Procter & Gamble have either exited or drastically reduced Nigerian operations.
For tech workers and founders, the compound effect is crushing. Their customer base has been decimated by inflation. Investors have disappeared. Foreign exchange volatility makes financial planning impossible. And now, the government wants a significantly larger slice of whatever remains.
The irony is sharp: Nigeria’s government is aggressively pursuing tax revenue from an ecosystem it has systematically undermined through policy decisions that destroyed purchasing power, scared off investment, and created operational chaos.
“When you start to look at the risk of the market, potential currency devaluations over a 10-year holding period, and a capital gains tax that’s north of 20%, it starts to make the investment opportunities quite uninvestable. That’s something we were very disappointed about,” Lexi Novitske, Norrsken22’s General Partner told Launch Base Africa.
The France factor
Adding to the intrigue is an October memorandum of understanding with France’s tax authority. The Federal Inland Revenue Service insists it’s purely technical cooperation — capacity building, digital transformation, best practices. The #FixPolitics Initiative isn’t buying it.
“We particularly note that the official statements were reactive, in response to public outcry, not a well-considered and intentional communication,” the group stated, calling for full publication of the agreement. “Tax administration lies at the core of state sovereignty, public trust and citizens’ rights.”
The concern is legitimate. Nigeria’s relationship with its former colonial power remains sensitive, and involving French officials in tax administration — particularly without transparency — feeds suspicions about sovereignty and data privacy. The government’s “trust us, it’s fine” posture hasn’t helped.
The mobility problem
Here’s what makes this particularly fraught: the laptop class is globally mobile. A software developer in Lagos earning dollars doesn’t need to be in Lagos. If the tax burden becomes onerous, the compliance requirements byzantine, and the enforcement capricious, they can simply leave. The brain drain isn’t hypothetical — it’s already happening.
Nigeria’s government faces a genuine dilemma. Oil revenues have collapsed. The country desperately needs tax revenue. A globally connected, dollar-earning tech sector represents an obvious target. But treating that sector as a cash cow to be milked rather than an ecosystem to be nurtured risks killing the very thing it’s trying to tax.
The government’s defence — that it’s simply asking people to pay their fair share — would be more compelling if the execution weren’t so chaotic, the timing so terrible, and the underlying law so apparently contested.
What happens next
The House of Representatives’ ad hoc committee is investigating. SERAP has called for Tinubu to publish certified true copies of the bills received from the National Assembly alongside the gazetted versions, and to establish an independent judicial panel to investigate alleged alterations. Civil society groups are demanding transparency, accountability, and suspension of implementation until the legal confusion is resolved.
Meanwhile, January 1, 2026 approaches. The government insists the reforms will proceed. Tax officials are already conducting aggressive assessments. Payment platforms are implementing withholding mechanisms. And Nigeria’s tech ecosystem is doing frantic calculations about whether staying is worth it.
The government’s fiscal gospel is clear: everyone who earns must pay. But when the congregation doesn’t know which scripture they’re being judged by, when the rules appear to change after being written, and when enforcement feels more like extortion than administration, faith becomes difficult.
For Nigeria’s dollar-earning laptop class, the question isn’t whether they should contribute to national development — most accept they should. It’s whether they can trust the system collecting the taxes, whether the burden is sustainable given the economic devastation around them, and whether the government understands that you can’t tax a diaspora if everyone decides to become one.
As one Lagos-based developer put it to Launch Base Africa, “They want to tax the digital economy. That’s fine. But the digital economy doesn’t need to be here.”
The government might collect more revenue in 2026. But at what cost?
The Nigeria Tax Act, Nigeria Tax Administration Act, Nigeria Revenue Service (Establishment) Act, and Joint Revenue Board (Establishment) Act were signed into law in June 2025 and are scheduled to take effect January 1, 2026.