Despite extensive media campaigns promoting the new tax act, led by the Nigeria Revenue Service (NRS) Executive Chairman Zacch Adedeji and the head of the Presidential Tax Reform Committee, Taiwo Oyedele, many Nigerians have cast doubt on the reforms, citing concerns about the agency’s expanded enforcement powers.
Details obtained by TVC News from the NRS’s official website capture the provisions and improvements in the new tax act compared to the old tax act.
The provisions highlighted in this article cut across Value Added Tax, Company Income Tax, Personal Income Tax, Capital Gains Tax, Administration and Compliance, and other levies.
Value Added Tax
Old Acts: The old tax regime contains a 7.5% limited input recovery.
New Acts: The new tax act contains a 7.5% full input recovery, including services and capex. It also contains an Expanded Zero-rated items and a mandatory e-invoicing or fiscalisation.
Company Income Tax
Old Tax Act: In the old tax regime, a 0% income tax for small companies with less than N25,000,000 gross turnover, 20% for medium companies with gross income sitting between ₦25,000,000 to ₦100,000,000 and 30% income taxation on large companies with gross turnover crossing N100,000,000.
New Tax Act: In the new act, a 0% income taxation for small companies with gross turnover less than ₦100,000,000, and 30% for large companies with gross turnover of ₦100,000,000.
Personal Income Tax
Old Act: In the old Tax regime, the progressive bands were placed above 24% and the presence of Consolidated Relief Allowance (CRA).
New Act: In the New Tax Act, the progressive bands are placed above 25% with a non-taxable income set at ₦800,000 with the Consolidated Relief Allowance (CRA). Rent relief and relief on loan interest for owner-occupied houses is now added.
Capital Gains Tax (CGT)
Old Act: In the old Tax regime, a Flat 10% for individuals and companies was charged on income.
New Act: In the new regime, no flat 10% rate and the chargeable gains are taxed as part of income tax of the individual’s or company’s income tax.
Other Levies
Old Act: In the old tax regime, charges including 2.5% TET, 1% IT levy, 0.25% NASENI levy, 0.005% Police Trust Fund Levy, etc., are placed.
New Act: In the new regime, all previously earmarked taxes and levies merged into a 4% Development Levy.
Administration & Compliance
Old Act: In the old tax regime, fragmented, multiple tax laws and weaker digital compliance were recorded.
New Act: In the new regime, the Federal Inland Revenue Service (FIRS) became the Nigeria Revenue Service (NRS) and was unified under the Nigeria Tax Administration Act (NTAA 2025) for national and subnational. uniformity. A new Tax Ombudsman was introduced, with stricter digital compliance rules.
TVC News previously reported that the Lagos State Internal Revenue Service (LIRS) has announced plans to begin its enforcement of statutory powers to recover unpaid taxes from defaulting taxpayers through third parties, including banks, employers, debtors, tenants and business partners.
In a public notice dated January 21, 2026, and cited by TVC News from the official LIRS website on Sunday, the revenue agency disclosed that it is empowered by the provisions of the Section 60 of the Nigeria Tax Administration Act, 2025, to direct any person holding money on behalf of, or owing money to, a taxpayer who has failed to settle a final tax liability to remit such funds.
Why Lagos Will Recover Unpaid Taxes Through Banks, Employers, Business Partners – LIRS
