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 widely debated 4 per cent development levy on imported goods is not a new tax burden but a consolidation of several existing levies previously paid separately by businesses.
In recent weeks, the new Nigeria Tax Act (NTA) and Nigeria Tax Administration Act (NTAA) have generated widespread debate among citizens and the business community over their economic implications. However, tax authorities say the concerns are largely driven by misinterpretations of the reforms.
According to FIRS, the objectives of the new laws include simplifying compliance, protecting existing incentives and improving Nigeria’s attractiveness as an investment destination.
One of the most misunderstood aspects of the new framework, the agency explained, is the 4 per cent Development Levy. FIRS noted that the levy replaces multiple fragmented charges such as the Tertiary Education Tax, NITDA Levy, NASENI Levy and the Police Trust Fund Levy, which businesses previously paid independently.
By consolidating these levies into a single charge, FIRS said the reform would reduce compliance costs, eliminate unpredictability and put an end to multiple agency-driven levies.
The agency also disclosed that the law exempts small businesses and non-resident companies, offering critical protection to firms most vulnerable to economic shocks.
Analysts have described the new levy structure as a positive signal to investors, noting that it reflects Nigeria’s shift toward a more coordinated, transparent and predictable fiscal environment.
FIRS also addressed concerns surrounding Free Trade Zones (FTZs), following reports that tax incentives for export-oriented investors were being withdrawn.
The agency clarified that the new tax laws retain the tax-exempt status of FTZ enterprises and introduce clearer operational guidelines to safeguard the original purpose of the zones as hubs for export-led industrial growth.
