..Exempts Businesses Earning Below N2m Annually
…Mandates Digital Payments, Outlaws Cash Enforcement
The Federal Government on Tuesday formally unveiled a new set of regulations aimed at bringing millions of informal businesses into the tax net, while banning cash collections and roadside enforcement by subnational authorities.
At a signing ceremony in Abuja, the Minister of Finance and Coordinating Minister of the Economy, Wale Edun, described the move as a decisive transition from legislation to implementation under President Bola Tinubu’s tax reform agenda.
Edun said the newly signed presumptive tax regulations mark the operational phase of tax reforms whose enabling Acts took effect between mid-2025 and January 2026.
“With the signing of these regulations, we are transiting from legislation to structural implementation of the tax reforms,” Edun stated, noting that the framework is anchored on transparency, fairness, clarity and equity.
He explained that the regulations were issued under powers vested in his office on the advice of the Joint Revenue Board to ensure consistency across federal, state and local governments.
According to him, the guidelines are designed to prevent arbitrary tax assessments, eliminate multiple collections and protect small businesses from exploitative practices.
Nigeria’s economy, he noted, grew by about four per cent in the final quarter of 2025 — a trajectory he described as encouraging but still short of the administration’s near-term target of seven per cent annual growth and its long-term ambition of building a $1 trillion economy by 2030.
Rather than raise tax rates, the government intends to expand the tax base by widening compliance among micro and small enterprises that dominate commercial activities nationwide.
Edun said formalising entry into the tax system would provide small businesses with structured access to growth opportunities while ensuring that each taxpayer makes what he called a “rightful contribution.”
He added that implementation would be closely monitored, with an ombudsman mechanism introduced to safeguard fairness and address complaints.
Executive Secretary of the Joint Revenue Board, Olusegun Philip Adesokan, described the regulations as a practical expression of the president’s position that reforms should promote prosperity rather than hardship.
“He doesn’t seek to tax poverty; his government will not tax seeds, but fruits,” Adesokan said, describing the framework as a uniform code to guide subnational governments in dealing with the informal sector.
Under the guidelines, informal businesses with an annual turnover of up to N2 million will be exempted from tax — a threshold officials say is intended to shield vulnerable operators and preserve their working capital.
Eligible informal businesses above that threshold will pay a presumptive levy of one per cent of annual turnover.
The regulations also mandate the use of technology-driven payment systems, outlaw cash collections by tax officials and prohibit the mounting of roadblocks for tax enforcement — practices long criticised by traders and transport operators.
Adesokan said the measures would create a seamless onboarding process for informal operators while addressing disparities in tax administration across states.
Chairman of the National Tax Policy Implementation Committee, Joseph Tegbe, said the signing bridges the gap between statutory provisions and practical execution.
Tegbe noted that the informal sector accounts for more than 80 per cent of employment but contributes relatively little to structured public revenue, largely due to fragmentation and weak enforcement frameworks.
He said all 36 states are aligned with the new guidelines, adding that the focus now shifts to disciplined rollout and safeguards against arbitrary assessments.
“With today’s signing, we move decisively from intention to execution,” Tegbe declared.
