Nigeria’s Senate Approves Key Tax Reform Bills

On 9 May 2025, Nigeria’s Senate passed four tax reform bills designed to boost government revenue and streamline fiscal administration. These measures include raising the value-added tax (VAT) to 12.5% starting in 2026 and shifting petroleum royalties and profit-tax collection to the proposed Nigeria Revenue Service.

Despite criticism from within President Bola Tinubu’s own party—fearing increased hardship—the Senate’s approval marks a significant step in overhauling the country’s fiscal framework. The bills now go to a joint committee to reconcile differences with the House version before being sent to the President for assent.

With Nigeria’s tax-to-GDP ratio languishing at around 10.8%, these reforms aim to reduce reliance on borrowing and diversify revenue sources for Africa’s largest economy.