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Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, Taiwo Oyedele, has revealed that Nigerians earning ₦250,000 or less per month will be exempt from paying personal income tax under the country’s new tax laws.

Oyedele disclosed this during an interview on Channels Television’s Politics Today on Thursday, shortly after President Bola Ahmed Tinubu signed four new tax bills into law at the Presidential Villa in Abuja.

According to him, the new tax policies, which will come into effect in January 2026, aim to stimulate economic growth, improve tax compliance, and shield low-income earners from taxation.

“This tax law will not put cash in your pocket, but at least it won’t take cash away from you if you are poor,” Oyedele explained.

The former Partner and West Africa Tax Leader at PricewaterhouseCoopers (PwC) clarified that the committee categorised individuals earning ₦250,000 or below per month as poor, based on Nigeria’s economic realities and household structure.

“We debated extensively to determine who should be classified as poor in Nigeria. The World Bank might say $2.15 per day per person, but in reality, there are people who live in villages, produce their own food, and don’t spend much on transportation or utilities. So, we adjusted our poverty line based on the Nigerian context,” he said.

Oyedele explained that the committee factored in an average household size of five people, with two income earners, leading to the ₦250,000 benchmark.

“If a household earns ₦250,000 or less, they can only cover basic needs. They are considered poor, and they should not be taxed,” he stated.

The tax reform committee, inaugurated by President Tinubu in July 2023, was tasked with modernising Nigeria’s tax system, promoting fairness, and boosting revenue without overburdening citizens.

Oyedele also disclosed that while tax burdens will be reduced for middle-income earners earning up to ₦2 million monthly, those in higher income brackets will see a slight increase in tax rates.

“The middle class, estimated at around ₦1.8 million to ₦2 million per month, will experience some tax relief. But for high-income earners, there will be a modest tax increase,” he added.

He noted that currently, Nigeria collects only 30% of its potential tax revenue, with the new laws designed to close the significant 70% gap by enhancing efficiency, protecting businesses, and ensuring the wealthy pay their fair share.



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