Tax Reforms Not Against the Poor, Analyst Assures Nigerians

By Idowu Adebomi, Ado Ekiti

A leading policy expert has   called for  calm over growing public concerns over Nigeria’s proposed tax reforms, assuring that the changes are designed to protect low- and middle-income earners while placing a greater burden on the country’s highest earners.

The clarification was made by investment banker and financial analyst, Sidiku Olyinkan Oscars,  during an exclusive interview.Sidiku addressed widespread speculation and misinformation surrounding the reforms scheduled to take effect in 2026.

He firmly dismissed rumours suggesting the introduction of a blanket 20 per cent tax on bank transfers and personal savings, describing such claims as false and misleading. According to him, savings account holders would not lose money, as interest earned on savings does not attract any new punitive levy under the proposed framework. He warned that the spread of unverified information was fuelling unnecessary public anxiety.

Sidiku explained that the centrepiece of the reforms is a progressive Personal Income Tax (PIT) system structured to promote equity. Under the new regime, individuals earning less than ₦800,000 annually would be completely exempt from income tax. He noted that this category includes minimum-wage earners, petty traders, artisans and many small-scale entrepreneurs.

For earners above the exemption threshold, he said tax obligations would be applied gradually. Individuals earning between ₦800,000 and ₦3 million per year would pay a 15 per cent tax only on the portion of income exceeding ₦800,000, ensuring that lower-income earners are not unduly burdened.

According to Sidiku, the most significant impact of the reforms is targeted at high-income earners. The new structure introduces a top tax rate of 25 per cent for individuals earning above ₦50 million annually. He described the measure as a deliberate attempt to improve Nigeria’s low tax-to-GDP ratio by ensuring that wealthy individuals contribute more meaningfully to national development.

He further stressed that the tax system applies uniformly, regardless of status or profession, noting that liability is determined strictly by income level. On the informal sector, Sidiku clarified that the same ₦800,000 exemption applies and that taxes would be assessed on profits rather than total turnover.

While acknowledging government efforts to enlighten the public through the media and relevant agencies, he called for broader grassroots sensitisation, particularly in local languages, to ensure wider understanding of the reforms.

As the 2026 implementation date draws closer, Sidiku described the reforms as a fiscal restructuring aimed at protecting the majority of Nigerians while compelling the nation’s wealthiest individuals to contribute what he described as their fair share to economic growth and development.