The federal government plans to reduce corporate income tax from 30% to 25%, while raising income tax of high-income earners to about 25%. Those earning below N1 million monthly will, however, be exempted from personal income tax. Taiwo Oyedele, the Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, said this in Abuja on Monday at the 30th Nigerian Economic Summit. He said the executive arm of government was already preparing an Executive Bill to be presented to the National Assembly. Oyedele said the tax reforms would take effect from January 2025 if passed by the National Assembly.
“We have been very intentional in reducing the tax burden of businesses. One of it is, today whatever VAT you pay on assets, whether you are building a factory or buying a laptop, on buying vehicles, you bear it. As a business, of course, it increases your cost and therefore your pricing will go up. Once our reforms are implemented, you get the credit back 100% on services and on assets. Your corporate income tax rate will come down from 30% to 25%, that’s also huge. We also have personal income plans that If you earn 1.5 million naira in a month or less, your personal income tax bill will go down, of course, at lower end, completely exempted. But if you earn more than that amount, you see it going up incrementally up to 25%. Today, if you earn N100 million a month, effective personal income tax rate, we’re taking that up to 25% for the rich people,” he said.
