Federal Government of Nigeria has approved the exemption of small businesses earning N25 million annually from withholding tax, according to Taiwo Oyedele, Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms.
Gatekeepers News reports that Oyedel, speaking at a consultation forum in Lagos, said the exemption aims to simplify the tax system and reduce the burden on small and medium-sized enterprises (SMEs).
He noted that the committee seeks to promote competitiveness, equity, and ease of compliance.
“The threshold for exemption is currently N25 million, but we propose to increase it to N50 million,” Oyedele said.
“Once approved, businesses earning N50 million or less will be exempt from withholding tax. This will help small businesses, such as restaurants, to focus on growth without worrying about deducting withholding tax.”
Oyedele explained that the withholding tax regulation aims to prevent tax avoidance, detect tax evasion, and close the tax gap, in line with global best practices.
He emphasised that the goal is to simplify the tax system and reduce the burden on businesses, particularly SMEs.
