A tax expert, Mr Olugbenga Obatola, has urged the Federal Government to strengthen digital infrastructure and eliminate multiple taxation to ensure the effective implementation of Nigeria’s new tax legislation scheduled to take effect from January 2026.
Obatola, a Fellow of the Chartered Institute of Taxation of Nigeria (CITN), said in an interview in Ibadan that while the 2025 Tax Reform Acts present significant opportunities for Small and Medium Enterprises (SMEs), weak digital systems and duplicative levies at sub-national levels could undermine the gains.
He described the reforms as one of the most far-reaching fiscal policy shifts for SMEs in decades, noting that companies with annual turnover of not more than ₦100 million would be exempted from key federal taxes, including Companies Income Tax, Capital Gains Tax, Stamp Duty, Education Tax and Development Levy.
According to him, the incentives are expected to improve cash flow, encourage reinvestment, enhance competitiveness and expand access to credit for qualifying businesses.
However, Obatola warned that poor internet access and limited digital tools, especially in rural areas, could restrict SME participation in the new tax regime, particularly with the introduction of mandatory e-invoicing and electronic tax reporting.
He also cautioned that unauthorised state and local government levies remain a major threat, stressing that parallel taxation could erode federal-level reliefs.
The tax expert called for stronger enforcement against arbitrary charges, widespread grassroots sensitisation and the provision of affordable digital accounting tools to support compliance.
“If implementation is inclusive and supported by the right infrastructure, the reforms can become a growth catalyst for SMEs. Without that, the policy may fall short of its potential,” he said.
