Low-income earners exempted from tax under new law — NRS

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The Regional Administrator of the Nigeria Revenue Service, Danjuma Manga, has said the 2025 tax reforms exempt individuals earning N800,000 or less annually from personal income tax, while increasing the share of federally collected revenue allocated to state governments.

Manga disclosed this on Thursday in Gombe during the 2026 symposium of the Forum of Heads of Federal Ministries, Departments and Agencies, which had the theme, “Aligning Federal, State and Local Government Priorities for Sustainable National Development.”

He said the reforms were designed to harmonise tax administration, improve compliance, promote fairness and strengthen the capacity of the three tiers of government to finance development.

According to him, the reforms are anchored on four pieces of legislation that have changed the operation of Nigeria’s tax system, particularly in the areas of tax policy, legislation and administration.

“Tax payment is the responsibility of all citizens, as provided under Section 24, subsection four of the Nigerian Constitution. However, you only pay tax when you earn income, make a profit or dispose of an asset and realise a gain,” Manga said.

He explained that the reforms were intended to encourage economic activity and protect low-income earners rather than impose unnecessary tax burdens on citizens.

He said individuals earning N800,000 or less annually would pay zero personal income tax under the new framework, while eligible reliefs and deductions would further reduce the taxable income of qualifying workers.

Manga, who doubles as the State Monitor for Adamawa, Gombe and Taraba states, also said individuals earning the national minimum wage of N70,000 monthly or less were exempted from personal income tax under the provisions he discussed.

He explained that the Nigerian tax system operated through three major pillars: tax policy, tax laws and tax administration, stressing that effective coordination among the responsible agencies was necessary to achieve the objectives of the reforms.

The regional administrator identified the Nigeria Revenue Service, state internal revenue services and local government revenue committees as the principal institutions responsible for administering taxes across the federation.

He said the new framework also sought to establish uniform administrative and compliance procedures across the federal, state and local government levels.

Manga further explained that the reforms introduced changes to the distribution of federally collected revenue, with the Federal Government ceding five percentage points of its share to state governments.

He said the revised formula allocated 10 per cent to the Federal Government, 55 per cent to state governments and 35 per cent to local governments.

He added that the allocation to states would be distributed based on factors including equality, population and internally generated revenue, with the reforms changing the weight assigned to the different criteria.

According to him, the changes were intended to reward states that improved tax collection and compliance while providing additional resources to meet development needs at the subnational level.

Manga stressed that states and local governments depended significantly on federally collected revenue, including value-added tax and other taxes shared among the three tiers of government.

He also urged Federal Government agencies and other institutions responsible for deducting taxes at source to ensure that deductions from contractors’ payments and other taxable transactions were remitted promptly.

“For government agencies that have responsibility for tax deduction at source, you have to observe due diligence. Whatever the tax element is, you must deduct it when paying your contractors and remit it to the government,” he said.

He added that improved tax compliance would strengthen public revenue and support the delivery of infrastructure and social services.

The regional administrator further said the reforms were expected to improve the ease of doing business and encourage the growth of micro, small and medium-sized enterprises across the country.

In his keynote address, the Chief Medical Director of the Federal Teaching Hospital, Professor Yusuf Abdullahi, called for stronger coordination among federal, state and local governments to ensure that development programmes reached vulnerable populations.

Abdullahi cited government interventions in cancer care, particularly for breast, cervical and prostate cancers, as examples of programmes that could benefit from coordinated planning and implementation.

He said the government had introduced pilot interventions to provide free treatment for selected cancer patients, adding that similar coordination was necessary across sectors, including agriculture, education and healthcare.

“The way forward is that we really have to align these priorities. They have to be coordinated in terms of delivery, and the outcomes must be measured,” he said.

“Sustainable national development depends on synchronised planning, transparent funding, shared evidence and accountable implementation across all three levels of government.”

He urged public institutions to move away from fragmented projects towards coordinated programmes capable of improving people’s lives.

Also speaking, the Chairman of the forum, Sadiq Ahmed, said the symposium had provided an opportunity for federal agencies to deepen their understanding of their responsibilities and contributions to development in Gombe State.

Ahmed said the presentations addressed the alignment of federal ministries, departments and agencies with state and local government priorities, the contributions of public institutions to national development and the implementation of the new tax laws.

He said the presentation by the regional administrator of the Nigeria Revenue Service had helped clarify issues surrounding the new tax framework, including concerns about overlapping taxes and duplication.

“I believe that the lecture will be beneficial to the entire MDAs, Gombe State and Nigeria at large,” Ahmed said.

He explained that although the forum comprised Federal Government workers serving in Gombe State, the symposium also involved stakeholders from the state and local governments to promote cooperation and improve understanding of the contributions of federal institutions to the state’s socioeconomic development.

“You know we are federal workers in Gombe State. Apart from being federal workers, we are proud contributors to the socioeconomic development of Gombe State,” he said.

Ahmed described the engagement as part of the forum’s corporate social responsibility, noting that collaboration with subnational authorities was essential to achieving sustainable development.

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