Nigeria Tax Bill 2024: President transmits tax reform bills to the National Assembly
JUST IN: President Bola Tinubu has transmitted tax reform bills to the National Assembly for consideration.The details of New Nigeria Tax Bill: TAX RATES & BASIS: Corporate Income Tax (CIT): Other companies: Personal Income Tax (PIT): Withholding Tax (WHT): Capital Gains Tax (CGT): Value Added Tax (VAT): The VAT rate specified in the New Tax Bill is as follows: These progressive rates reflect a strategic approach to increase VAT over time, aligning with the government’s revenue optimisation goals. Digital Assets and Transactions: Taxed similarly to financial instruments, with gains subject to Capital Gains Tax at 10%. 5 KEY HIGHLIGHTS: Digital Economy Inclusion: The Bill recognises and introduces taxation for digital assets, online services, and fintech activities, bringing the Nigerian tax system in line with international standards. Consolidation of Tax Laws: By merging various tax regulations into a single legal framework, the Bill simplifies tax administration and compliance, reducing complexity for taxpayers. Tax Incentives and Reliefs: The Bill includes provisions for small businesses, exempting those with an annual turnover below ₦50 million from Corporate Income Tax, encouraging entrepreneurship and small-scale enterprise growth. Withholding Tax (WHT) Adjustments: The Bill streamlines WHT rates for various transactions, ensuring taxes are deducted at source, reducing the likelihood of tax evasion. Removal of VAT on Rent: In line with the Finance Act, VAT is no longer applicable to rent-related transactions, reducing the financial burden on businesses and individuals who lease properties. Taxation of Gains from Digital Assets: Gains from digital transactions are now clearly subject to Capital Gains Tax, reflecting the growing importance of the digital economy. The New Tax Bill marks a major reform in Nigeria’s tax system, offering a comprehensive, unified, and modern framework for taxation. By broadening the tax base, simplifying compliance, and recognizing emerging sectors such as the digital economy, it positions Nigeria to enhance revenue generation while promoting fairness and equity. As the Bill takes effect from 2025, it is expected to streamline tax administration, support business growth, and encourage compliance, all while fostering a tax system that is responsive to the needs of a rapidly evolving economy…
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