The Presidential Fiscal Policy and Tax Reforms Committee has dismissed a viral video claiming that a new 25 per cent tax would be imposed on building materials and related transactions in 2027, calling the report false.
In a statement made available to Channels Television on Sunday, the committee clarified that the Nigeria Tax Act 2025 is already in effect and contains no such provision. Instead, the Act introduces measures aimed at reducing housing costs, promoting real estate development, and supporting small businesses and low-income renters.
Key provisions include a Value Added Tax (VAT) exemption on land, buildings, and rent, input VAT credits for contractors to reduce construction costs, and a lower 2 per cent Withholding Tax rate on construction contracts.
Renters are entitled to relief of up to ₦500,000 (20% of annual rent), and lease agreements below ₦10 million annually are exempt from stamp duty. Property owners can also deduct expenses such as repairs and insurance from rental income.
The Act further provides incentives for investors, including Capital Gains Tax exemption on the disposal of dwelling houses and tax benefits for Real Estate Investment Trusts distributing at least 75 per cent of income annually. Manufacturing of building materials like iron, steel, and domestic appliances qualifies for specific tax exemptions for up to 10 years.
Small businesses benefit from zero per cent Companies Income Tax, VAT exemptions, and relief from Withholding Tax deductions.
The committee urged Nigerians to rely on verified provisions of the law rather than misinformation designed to create fear. “Claims suggesting a new tax on building materials or bank funds are false and misrepresent the law,” it said, adding that the reforms aim to make housing more affordable, promote real estate development, and increase disposable income.
President Bola Tinubu assented to four tax reform bills in June 2025, including the Nigeria Tax Bill, Nigeria Tax Administration Bill, Nigeria Revenue Service (Establishment) Bill, and Joint Revenue Board (Establishment) Bill. According to the presidency, the new framework will transform tax administration, enhance revenue generation, improve the business environment, and attract domestic and foreign investment.
