Nigeria Introduces New Tax Regime with 5% Annual Tax Credit for Companies

The new tax regime in Nigeria, effective from January 2026, will offer a 5% annual tax credit to both multinational and local companies. The policy, led by Taiwo Oyedele of the Fiscal Policy Tax Reform Committee, includes incentives for investment in priority sectors and aims to exempt smaller businesses from corporate tax burdens.

The reform is designed to enhance compliance culture, promote formalization, and drive inclusive growth, particularly among micro, small, and medium-sized enterprises (MSMEs). Oyedele emphasizes the importance of tax literacy and the need for stronger public understanding of taxation in Nigeria to improve compliance and trust in the new framework.