The Federal Inland Revenue Service (FIRS) has stated that Nigeria’s newly enacted tax laws are designed to strengthen economic competitiveness, attract investments and improve long-term fiscal stability.
The agency also clarified that the much-debated 4 percent Development Levy on imported goods is not a new or additional tax burden, but a streamlined consolidation of several existing levies.
In recent weeks, the new Nigeria Tax Act (NTA) and Nigeria Tax Administration Act (NTAA) have sparked widespread debate among citizens and businesses seeking clarity on how the reforms will affect them.
While public debate continues, authorities insist the new tax regime is not punitive but strategic—balancing investor incentives with national revenue needs, and positioning Nigeria as a more predictable and attractive destination for global capital.
But tax authorities say these concerns stem largely from misinterpretations, insisting the laws are aimed at simplifying compliance, protecting incentives and improving Nigeria’s investment environment.
According to FIRS, one of the most misunderstood elements of the new tax framework is the 4 percent Development Levy. The agency explained that the levy replaces a range of fragmented charges—such as the Tertiary Education Tax, NITDA Levy, NASENI Levy and Police Trust Fund Levy—that businesses previously paid separately.
This consolidation, it said, 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.
Analysts say the new levy structure sends an important message to investors: Nigeria is moving toward a more coordinated, transparent and predictable fiscal environment.
(Business Day)
