Small businesses and non-resident firms exempt under 2026 tax reforms
The Federal Inland Revenue Service (FIRS) has reassured Nigerian businesses that the new 4 percent development levy on imported goods will not create an extra tax burden.
In a statement issued on Wednesday, the agency explained that the levy is essentially a consolidation of several existing charges, introduced to streamline the tax system and improve the overall business climate.
The FIRS noted that public concern over the Nigeria Tax Act (NTA) and the Nigeria Tax Administration Act (NTAA) largely stems from “misinterpretations,” particularly regarding the structure and purpose of the new levy.
According to the agency, the reform is designed to boost economic competitiveness, safeguard existing incentives, and maintain long-term fiscal stability.
By combining multiple levies into a single 4 percent charge, the FIRS said the government aims to:
- Reduce compliance costs for businesses
- Eliminate unpredictability in tax obligations
- End overlapping charges from multiple government agencies
The FIRS emphasized that small businesses and non-resident companies are exempt, providing relief to those most vulnerable to economic shocks.
“This consolidation reduces compliance costs, eliminates unpredictability, and ends the era of multiple agency-driven levies. The law also exempts small businesses and non-resident companies, offering protection to firms most vulnerable to economic shocks,” the statement said.
The clarification comes as businesses express concern that the federal government’s new tax framework, set to take effect in January 2026, might increase their financial obligations.
About the Author
