In a landmark move aimed at protecting low-income earners and reforming Nigeria’s tax system, President Bola Tinubuhas signed into law a set of tax reforms that exempt Nigerians earning ₦250,000 or less monthly from paying income tax.
The announcement was made by Taiwo Oyedele, Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, during an interview on Politics Today aired by Channels Television on Thursday, June 26, 2025.
“How can anyone earning ₦30,000 monthly survive?” Oyedele questioned. “We proposed that anyone earning up to ₦1 million annually, including allowances, should be exempt from tax.”
According to Oyedele, this move follows the president’s approval of four new tax bills, designed to stimulate economic activity, curb tax evasion, and prevent the government from taxing poverty.
The committee arrived at the ₦250,000 monthly threshold after assessing the poverty line and average household conditions in Nigeria. With an assumed family size of five and two working adults earning ₦120,000 to ₦130,000 each, the income level was considered just sufficient for basic survival.
“If the earnings are about ₦250,000, they can take care of themselves,” Oyedele explained. “Of course, they are not going to have luxury, but at least they can survive. They are poor, and they shouldn’t pay taxes.”
The reform is expected to offer financial relief to millions of Nigerians, with implementation set to begin in January 2026. Oyedele emphasized that although the new law won’t directly put cash into people's pockets, it will ensure that “the government doesn’t take cash away if you are poor.”
He also noted that the policy won’t leave out higher earners entirely. For the estimated 5% of Nigerians who earn ₦1.8 million to ₦2 million monthly, tax rates will be reduced, not eliminated.
The move has been lauded by economists and civil society groups as a bold step toward fiscal justice and inclusive economic growth, especially amid Nigeria’s rising cost of living and growing demands for a fairer taxation system.