Governor Peter Mbah of Enugu State has reaffirmed his administration’s support for Nigeria’s sweeping tax reforms, urging citizens and businesses in the South-East to embrace voluntary compliance as a pathway to accountability and sustainable development.
The governor spoke in Enugu while declaring open the South-East Zonal Tax Sensitization Programme jointly organised by the Chartered Institute of Taxation of Nigeria (CITN) and State Internal Revenue Services in the region, with the Enugu State Internal Revenue Service (ESIRS) serving as host.
Represented by Deputy Governor Ifeanyi Ossai, Mbah acknowledged that taxation has historically generated distrust in many developing economies but argued that the Nigeria Tax Reforms Act 2025 is structured to correct structural imbalances.
“Taxation has carried certain sensitivities in our environment,” he said. “However, the reforms are designed to ease the burden on low-income earners while strengthening accountability in governance. When citizens contribute, they are better positioned to demand transparency.”
He charged tax authorities to ensure continuous training and effective supervision of frontline officers, noting that “public confidence in reform depends largely on how taxpayers are treated.” He also encouraged greater public awareness of dispute-resolution mechanisms such as the Tax Appeal Tribunal and called for flexible compliance frameworks for businesses in areas with limited digital connectivity.
Nnamani: Reform Will Fail Without Voluntary Compliance
Executive Chairman of ESIRS, Mr. Emmanuel Ekene Nnamani, FCTI, was direct: voluntary compliance is the reform’s backbone.
“Voluntary compliance remains the cornerstone of this new tax regime,” Nnamani said. “The reforms were introduced to rebuild trust, simplify compliance processes, digitise administration, and protect low-income taxpayers.”
He explained that companies may deduct donations of up to 10 percent of profit before tax where properly documented, and that capital allowances apply strictly to qualified and certified capital expenditure.
“A company is legally separate from its owners,” he cautioned. “Business and personal funds must not be mixed. Documentation is critical.”
Nnamani further advised taxpayers to retain financial records for at least six years to enable them contest inaccurate assessments. He clarified that individuals earning below ₦800,000 annually are exempt from income tax under the new law but must still maintain proper records.
Enterprises employing staff, he added, must obtain a Tax Identification Number (TIN), file PAYE returns, and ensure statutory deductions are properly remitted.
Olarinde: Nigeria Must Close Its Revenue Deficit
Tax expert Olufemi Olarinde provided national context, noting that Nigeria’s tax-to-GDP ratio remains slightly above 10 percent – below Africa’s 15 percent average.
“That gap limits our ability to fund infrastructure, healthcare, education, and social services,” he said.
He traced the reforms to President Bola Ahmed Tinubu’s 2023 commitment to building a tax system that “taxes prosperity, not poverty,” which led to the establishment of the Presidential Fiscal Policy and Tax Reforms Committee and ultimately the Nigeria Tax Reforms Act 2025.
Olarinde explained that under the new framework, small companies with turnover not exceeding ₦100 million pay zero percent corporate income tax, while large companies are taxed at 30 percent with a planned reduction to 25 percent. Multiple earmarked taxes have been consolidated into a single Development Levy, capital gains tax has been harmonised with income tax, and minimum tax has been repealed for loss-making companies.
“Taxation is not merely administrative; it is constitutional,” he said, referencing Section 24 of the 1999 Constitution, which mandates citizens to declare income honestly and pay taxes promptly.
He stressed that businesses have dual obligations – as taxpayers and as collection agents – requiring them to charge and remit VAT, deduct withholding tax, and deduct PAYE from employees’ salaries.
“Compliance is not coercion,” Olarinde said. “It is an investment in national stability.”
CITN 17th President and Chairman of Council Commends Enugu
In his remarks, the 17th President and Chairman of Council of CITN, Mr. Innocent Ohagwa, FCTI, commended Governor Mbah for creating an enabling environment that supports responsible revenue mobilisation and economic activity.
He described the collaboration between CITN and ESIRS as a model of institutional partnership and praised Nnamani’s reform-driven leadership.
“Sustainable revenue growth can only occur where taxpayers are informed, institutions are efficient, and trust exists between government and citizens,” he said.
What the Nigeria Tax Reforms Act 2025 Means for Individuals and Businesses
The Nigeria Tax Reforms Act 2025 introduces significant structural changes aimed at simplifying the system and encouraging compliance.
For individuals, annual earnings below ₦800,000 are exempt from income tax. However, proper record-keeping remains mandatory.
For small companies with turnover not exceeding ₦100 million, corporate income tax is zero percent. Large companies are taxed at 30 percent, with a gradual reduction planned.
Minimum tax has been repealed for loss-making companies, easing pressure on struggling businesses. Capital gains tax has been harmonised with income tax rules, allowing for loss deductions.
Businesses are required to register for a TIN, maintain proper books, issue tax invoices (including electronic invoices), file returns on time, and remit statutory deductions such as VAT, PAYE, and withholding tax.
Taxpayers retain rights under the law, including the right to object to assessments within 30 days, appeal decisions, and obtain refunds or tax credits where applicable.
A Reform Framed as Partnership
Across presentations, a common message emerged: the reforms seek to replace complexity with clarity and suspicion with cooperation.
Governor Mbah’s representative summarised the mood of the programme: “When compliance is voluntary and governance is accountable, taxation becomes not a burden but a partnership for development.”
The Enugu sensitisation programme ultimately framed voluntary compliance as a shared civic responsibility – essential for funding infrastructure, strengthening institutions, and securing long-term economic growth.
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