iDeemlawfulThe Nigeria Labour Congress has issued a warning of possible revolt over plans to begin enforcing the newly enacted tax reform laws from January 1, 2026.
According to the NLC, it was not aware of the tax laws, saying it was neither involved during their drafting nor consulted after they were passed by the National Assembly and signed into law by President Bola Tinubu.
Expressing worries about the timing, lack of clear communication and the potential effects on workers and businesses, the NLC cautioned that the reforms could deepen citizens’ burdens, harm small enterprises and dampen economic activity.
In contrast, the Manufacturers Association of Nigeria welcomed the laws, describing them as favourable and beneficial to its members.
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At the same time, operators of small and medium-scale businesses and the Employers Association for Private Employment Agencies of Nigeria urged the government to halt implementation, pointing to low public awareness and insufficient engagement with stakeholders.
However, the Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, Taiwo Oyedele, defended the reforms, arguing that postponement could lead to higher prices for essentials such as food, healthcare and education, while keeping workers and small businesses excessively taxed.
Oyedele maintained that delaying the reforms would preserve the existing tax framework, which he said already places heavy pressure on workers and small enterprises.
The tax reforms became law on June 26 when President Bola Tinubu assented to four major tax bills, an action the government described as the most far-reaching restructuring of Nigeria’s tax system in decades.
The laws include the Nigeria Tax Act, the Nigeria Tax Administration Act, the Nigeria Revenue Service (Establishment) Act and the Joint Revenue Board (Establishment) Act, all operating under a unified authority, the Nigeria Revenue Service.
Nonetheless, the laws attracted controversy last week after a member of the House of Representatives, Abdussamad Dasuki (PDP, Sokoto), alleged inconsistencies between the versions passed by lawmakers and those later gazetted and made public.
Dasuki, who raised the issue during plenary last Wednesday, insisted that the published laws did not reflect what legislators debated, approved and passed.
Labour threatens revolt
Speaking on Sunday, NLC spokesperson Benson Upah said organised labour had rejected the tax laws.
He said the congress remained uninformed about the content of the laws, despite workers being the largest contributors to the country’s tax revenue.
“At the level of the congress, we do not even know what these laws contain, yet we are the largest tax-paying community in the country. There has been no sensitisation or public enlightenment directed at the NLC or the labour community. This is an affront and a clear disrespect to the citizens. The right to know what is going on is not a privilege; it is a right. Nobody is doing us any favour.
“We are asking for certain things to be done: public enlightenment, public education on what these tax reform laws are all about, who they are meant to benefit, and all of that, before they are implemented,” Upah said.
He also questioned reports about the introduction of tax agents, describing the situation as unclear and unacceptable.
“There are other issues, too. We have also heard that there are going to be tax agents for the enforcement of the laws; these issues are totally opaque, and they are unacceptable.
“The processes of tax accumulation or collection, warehousing of tax proceeds and utilisation of those proceeds should be transparent; if not, we will revolt, not just us, but the people, the citizenry will revolt,” Upah added.
Upah further criticised the absence of labour representation on the tax reform committee, despite repeated calls for inclusion.
“We are the largest tax-paying community in the country. How can anybody shave our head in our absence? I think at that level, our input was necessary. Since the tax committee finished its job, it went to the National Assembly, and the Bill became an Act, nobody has deemed it fit to invite us for our input or enlighten us. This is a big snub.
“When taxes are low and transparent, more people will pay, but when taxes are high and their use opaque, people avoid paying. It is in this context that people will revolt, and even the NLC will revolt, unless there is a certain transparency around the process of collection and use of taxes being collected. All of that has to be made very plain to the people of this country and to us, because it is our right,” he said.
Another senior NLC official, who requested anonymity, said labour had called for the complete withdrawal of the laws, accusing the Federal Government of excluding workers and other key stakeholders from the process.
He warned that organised labour would oppose any policy that worsens the economic difficulties already confronting Nigerians.
Private sector demands suspension
Similarly, the President of the Association of Small Business Owners of Nigeria, Femi Egbesola, said implementing the laws without adequate understanding among micro, small and medium enterprises could undermine their success.
According to him, pushing forward under such conditions could produce poor results.
“The implementation should be suspended. The majority of the MSME space does not even understand it. You do not implement what people do not understand. If you force yourself to implement it, there will be a mismatch, and you will not get the kind of result you want. Along the line, it may be a colossal failure,” Egbesola said.
He also expressed concerns about the readiness of the proposed Nigeria Revenue Service, which will replace the Federal Inland Revenue Service, to effectively track transactions nationwide.
Egbesola noted that sensitisation efforts remained inadequate and that many issues surrounding the reforms were still unclear.
“The majority of the SMEs do not really understand the tax reform and law. You can only align with what you understand,” he said.
Citing data from the Small and Medium Enterprises Development Agency of Nigeria, he said micro and small businesses account for about 87 per cent of Nigeria’s estimated 40 million MSMEs.
“These 87 per cent are micro businesses, and for you to interpret things to them, it must be different. Those in charge of sensitisation need to do more,” he added.
He warned that insufficient awareness could provoke resistance.
“If those that are supposed to align with it are not yet aware of the modalities, how do you implement them? You may not get full compliance, and you may even see some form of revolt or protest,” he said.
Egbesola also recommended a pilot phase before full enforcement.
“When you are bringing in a reform that cuts across the board, you should allow time for a pilot phase of two or three months before full compliance,” he stated.
Likewise, the Executive Secretary of the Employers Association for Private Employment Agencies of Nigeria, Jide Afolabi, supported calls for a temporary suspension to address alleged discrepancies in the laws.
“EAPEAN aligns with the view that a temporary suspension of implementation would be beneficial. Given the reported discrepancies between the passed bill and the gazetted law, it is important to first reconcile the two versions to avoid confusion, misinterpretation and unintended compliance challenges.
“A brief pause would also allow for wider stakeholder engagement, enlightenment and the issuance of clear implementation guidelines. This approach will ultimately lead to better compliance and acceptance of the reforms,” he said.
MAN backs tax laws
The Director-General of MAN, Segun Ajayi-Kadir, however, reaffirmed support for the reforms, saying manufacturers are optimistic about a more business-friendly tax environment.
He said manufacturers expect relief from what he described as excessive and disruptive taxes imposed by sub-national authorities, adding that the reforms would curb harassment of businesses.
“We anticipate liberation from what I would call nuisance and irritant taxes from the sub-nationals. It should finally come to an end, and the economy and all of us will be net beneficiaries. I can anticipate with joy my members operating without any roadblocks for the purpose of collecting official and unofficial taxes and levies.
“My position is that we are looking forward to the implementation of the tax laws from January 1, 2026. We fully participated in stakeholder engagement, and we know that the law is excellently positioned to help businesses, particularly small-scale industries and even big businesses,” he said.
Ajayi-Kadir noted that the reforms would ease pressure on small businesses, explaining that firms with turnovers below N100m would be exempt from company income tax, value-added tax and withholding tax.
“Our members, especially the small ones whose turnover is less than N100m, will not pay CIT, VAT and WHT. As it is, they are struggling and need to be encouraged.”
He added that lowering company income tax would align Nigeria with global standards, encourage reinvestment and attract investment, while low-income earners would be exempt and middle-income earners would benefit from expanded reliefs.
Ajayi-Kadir also described the creation of a tax ombuds as a significant safeguard for taxpayers.
“The institution of the tax ombuds will be a welcome relief from the current situation of near hopelessness in the hands of the tax man. I don’t really see any cadre of earners that will be worse off from January 1, 2026.
“Even the upper two per cent of earners who are going to pay the highest 25 per cent have their companies well benefited from the tax regime and therefore are adequately compensated,” the MAN DG said.