Nigeria Reduces Late Tax Payment Interest Rates Effective 2026

The federal government issued the Nigeria Tax Administration (Interest on Late Payment of Tax) Order, 2026, which will take effect on October 1, 2026. This order, announced by the Minister of Finance and Coordinating Minister of the Economy, Mr. Taiwo Oyedele, applies uniformly across federal, state, and Federal Capital Territory (FCT) tax authorities.

The new interest rate for naira-denominated tax is set at the Central Bank of Nigeria’s Monetary Policy Rate plus one percentage point, a reduction from the previous five percentage point spread. For foreign currency tax, the rate will be the Secured Overnight Financing Rate (SOFR) plus six percentage points.

The Nigeria Revenue Service (NRS), led by Executive Chairman Dr. Zacch Adedeji, aims to improve taxpayer confidence and revenue collection with a new tagline, “Inspiring Trust, Sustaining Growth.” The Ministry of Finance emphasized that the order ties late payment costs to real market rates, ensuring that delaying tax payments is not a cheaper alternative to market borrowing.