Tax Laws: Govt Won’t Debit Your Account, Oyedele Assures Nigerians

The Federal Government has reassured Nigerians that the new tax reforms set to take effect from January 1, 2026, will not involve automatic debits from personal bank accounts, and individuals do not need to provide explanations for transfers.

Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, gave the assurance on Channels Television’s end-of-year special, 2025 In Retrospect: Charting a Pathway to 2026, which focused on politics, security, economy, and tax Policy

Addressing widespread misconceptions surrounding the reforms, Oyedele explained the process, emphasising its simplicity and transparency.

“People think that the government will debit their bank accounts from next year, and how they even came up with that, I have no idea. Nobody will debit your account for any amount you transfer. Whether it’s a billion or one thousand naira, at the end of the year, you tell the government yourself,” he explained.

Oyedele said the new tax system simplifies reporting and ensures fair taxation for small businesses, without burdening the vulnerable.

“You know what constitutes your income and what doesn’t. So you tell the government: ‘This is my income and here is the tax.’ If you are exempted, you simply declare: ‘This is my income, and I am exempted from tax.’ It is a very simple process that we are simplifying further.

“One of the biggest benefits is that if you run a small business as a sole proprietor, an enterprise, or you are just hustling, the system will no longer be regressive, taxing the vulnerable more. We’ve made it progressive,” he said.

Earlier on Tuesday, President Bola Tinubu confirmed that the implementation of the new tax laws will commence as scheduled, despite criticisms from political figures, opposition groups, and labour unions.

In a statement, Tinubu said the laws are not designed to increase taxes but to support a structural reset, promote harmonisation, protect citizens’ dignity, and strengthen the social contract.

“The new tax laws, including those that took effect on June 26, 2025, and the remaining acts scheduled to commence on January 1, 2026, will continue as planned.

“These reforms are a once-in-a-generation opportunity to build a fair, competitive, and robust fiscal foundation for our country,” he said.

The president called on all Nigerians to support the reforms as they take effect in the coming days.

The reforms, signed into law in June 2025, aim to simplify Nigeria’s tax system, broaden the tax base, and protect low-income earners and small businesses.

Key provisions of the tax reforms include full personal income tax exemption for those earning ₦800,000 or less, while higher earners face progressive rates capped at 25 per cent.

Small businesses with turnover under ₦100 million are exempt from company tax, VAT, and the new development levy, and corporate tax for larger firms drops from 30 to 25 per cent.

VAT remains at 7.5 per cent with exemptions for essentials, and revenue collection will be centralised under the Nigeria Revenue Service.

Despite some controversy and court challenges, the government has clarified that ordinary citizens will not face automatic debits or new taxes, and exemptions cover minimum wage earners, pensions, gifts, remittances, and diaspora Nigerians.

The reforms are designed to ease tax burdens, support small businesses, and promote a fairer, more transparent tax system while driving economic growth, it said.