Taiwo Oyedele, the Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, stated that the new tax laws signed by President Bola Tinubu classify Nigerian households earning ₦250,000 a month as poor, exempting them from taxes.
This comment was made during an appearance on Channels Television’s Politics Today monitored by Tunexreportes shortly after the president approved four tax bills.
Oyedele, who has been in his role since July 2023, characterized his two-year term as both challenging and eventful. He explained that the primary aim of the new laws, effective January 2026, is not merely to increase revenue but to promote economic activity and identify tax evaders.
He emphasized that the legislation is designed to protect businesses and ensure that the government does not tax those in poverty. The new laws prioritize efficiency, growth, and the needs of the people. Oyedele noted that the committee had discussions about defining poverty in Nigeria and reached a conclusion.
He explained, “We considered data from organizations like the World Bank and the UN, which indicates that living on two dollars and fifteen cents a day places one at the poverty line. However, some people earn less than that but are self-sufficient because they produce their own food and don’t incur transportation costs. Having grown up in a village, I understand that perspective.”
The committee established a Nigerian poverty line based on an average household of five members, typically with two earners providing for the entire family. This analysis led them to determine that households earning between ₦120,000 and ₦130,000 for two working adults can sustain themselves, indicating they are poor and should not be taxed.
According to Oyedele, the new tax law won’t provide direct financial support but will ensure that those in poverty won’t lose money through taxation. He clarified that individuals earning below the established threshold would not pay taxes due to insufficient income.
The committee’s approach results in the removal of taxes for lower-income individuals, reductions for middle-income earners, and slight increases for high earners. The middle-income range was estimated to be around ₦1.8 to ₦2 million monthly; those earning within this range will see a reduction in taxes from current amounts, though their tax wouldn’t be eliminated entirely. This group represents about 5% of Nigeria’s population.
Oyedele also highlighted that Nigeria currently collects only around 30% of its potential tax revenue, stressing that the goal of the new tax laws is to bridge the 70% gap.
