The Chairman of the Presidential Fiscal Policy and Tax Reforms Committee, Mr. Taiwo Oyedele, has announced that about 98 percent of Nigerian workers will be exempted from paying Pay-As-You-Earn (PAYE) tax when the new tax laws take effect from January 2026.
Speaking during a session at the 31st Nigerian Economic Summit (NES31) in Abuja, Oyedele said the reforms are designed to protect low-income earners and create a more equitable and efficient tax system.
"The more inequality you create, the more time bombs you have," he stated. "These reforms aim to strengthen governance around revenue generation, improve accountability, and ensure tax revenues are effectively utilised."
According to him, the tax reform package—part of President Bola Tinubu's fiscal policy agenda—will enhance Nigeria's credit rating, reduce borrowing costs for both government and businesses, and attract private-sector investment.
Oyedele, who revealed that he had received death threats over his role in the initiative, described the reform process as tough but necessary. "I have suffered all kinds of things, including death threats," he said. "But I am not scared. I recently celebrated my 50th birthday. Even if anything happens, I have done my bit. The reforms belong to Nigerians."
He noted that the new tax system seeks to ensure fairness by making the wealthy and large corporations contribute more to national development.
"The poor will not pay personal income tax," he said. "Those who earn more and have greater means will pay more. That is how fairness works in a modern economy."
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Oyedele also disclosed plans to introduce tax-exempt stickers for nano businesses, including street vendors, petty traders, and artisans, to protect them from harassment by local officials.
Addressing concerns about state and local government resistance, he assured that the Joint Tax Board (JTB), which represents all 36 states and the FCT, is fully involved and supportive of the reforms.
He added that the reforms would not deprive states of revenue but rather help them earn more from the Federation Account without overburdening citizens.
"Last year, states generated N3.36 trillion from taxes," Oyedele said. "Under the new structure, states will not do worse. We can't do better by taxing our most vulnerable."
He further explained that the committee has proposed amendments to outdated tax provisions, including the "wheelbarrow tax," describing such levies as retrogressive.
"We have worked on the expenditure side as well," he added. "Our focus is on ensuring transparency and prudence in government spending so that Nigerians get full value from their taxes."
Oyedele concluded that the long-term goal of the reforms is to create a simple, fair, and efficient tax system that promotes growth, attracts investment, and shares the tax burden justly across all segments of society.
