FG to Implement Personal, Company Income Tax Reforms from January 2026

The Federal Government has announced that reforms in Personal Income Tax (PIT) and Company Income Tax (CIT) will take effect from January 2026, in line with Nigeria’s fiscal calendar.

Chairman of the Federal Inland Revenue Service (FIRS), Zaccheus Adedeji, made this known on Tuesday while briefing State House correspondents at the Presidential Villa, Abuja.

Adedeji also clarified the government’s borrowing strategy, emphasizing that loans remain a legitimate tool for financing infrastructure and economic growth, rather than a sign of financial crisis.

On the Central Bank’s “Ways and Means” facility, the FIRS chief explained that the Tinubu administration ended direct overdraft financing. The outstanding exposure has been converted into a structured federal loan, with principal and interest being repaid according to approved terms.

“One of Mr. President’s key decisions was to collateralize Ways and Means. The system is now stable, and pressure on the exchange rate has eased,” he said.

Addressing criticisms over continued borrowing despite improved revenue, Adedeji noted that borrowing is a normal feature of national budgets. “A budget comprises expenditure, revenue, and loans. Borrowing allows governments to invest in assets like roads, which generate future revenue. It is not used for recurrent expenses such as salaries,” he added.

On tax reforms, Adedeji said Nigeria’s four major tax laws — the Tax Act, Tax Administration Act, Nigeria Revenue Service Act, and Joint Tax Board Act — are being harmonized. Administrative reforms have already taken effect, but substantive changes, including PIT and CIT adjustments, will begin in January 2026 to align with the fiscal year.

“Company Income Tax is assessed on profits of the preceding year. Implementing reforms in January prevents distortions and ensures smoother compliance,” he explained.

The FIRS has also commenced operations as the “Nigeria Revenue Service” under the new law, effective from the date of presidential assent.