Announced by the National Orientation Agency (NOA) via its official X (formerly Twitter) handle, the directive is aimed at improving tax compliance, curbing financial irregularities, and aligning Nigeria’s fiscal policies with international standards. The new rule, anchored in Section 30 of the Act, places commercial banks at the center of a renewed push for financial transparency.
According to the NOA, this monthly reporting requirement is part of broader efforts to ensure that taxable income, particularly from high-value and informal sector transactions, is captured within the tax system.
In addition to the transaction monitoring directive, the Act introduces several relief measures for low- and middle-income earners. Notably, the threshold for personal income tax exemption has been raised from ₦500,000 to ₦800,000 annually (about ₦66,667 monthly), offering more protection to those struggling with rising living costs.
The reforms also bring new tax exemptions: Capital gains from the sale of a primary residence will no longer be taxed. Compensation of up to ₦10 million for job loss, injury, or defamation will be exempt from taxation.
A new VAT sharing formula will also take effect from 2026:
Federal Government: 10% (reduced from 15%).
State Governments: 55% (up from 50%), distributed as follows: 50% equally, 20% by population, 30% by consumption.
Local Governments: 35% (unchanged).
Experts have welcomed the reforms, describing them as a strategic move to broaden Nigeria’s tax base without putting additional pressure on low-income citizens. Analysts believe the focus on high-value transactions and a consumption-based VAT distribution model signals a shift toward a more equitable and transparent tax system.
Click to signup for FREE news updates, latest information and hottest gists everydayAdvertise on NigerianEye.com to reach thousands of our daily users
No comments
Post a Comment
Kindly drop a comment below.
(Comments are moderated. Clean comments will be approved immediately)
Advert Enquires - Reach out to us at NigerianEye@gmail.com