The Chairman of the Presidential Fiscal Policy and Tax Reforms Committee, Taiwo Oyedele, has strongly defended Nigeria’s newly gazetted tax laws, describing most concerns raised by KPMG Nigeria as misunderstandings of policy intent or disagreements with deliberate reform choices rather than actual errors.
Okay News reports that in a detailed statement issued on Saturday, Oyedele welcomed constructive feedback while clarifying that several points flagged by the global audit firm were either taken out of context, mischaracterised, or presented as facts when they reflected opinions and preferences.
He emphasised that while a few observations on implementation risks and minor clerical or cross-referencing issues were useful, the majority of KPMG’s report did not reflect genuine mistakes in the legislation.
Oyedele stated that disagreements with policy direction should not be framed as errors or gaps, urging stakeholders to engage dynamically in supporting effective implementation rather than offering static critique.
On the taxation of shares and stock market transactions, he explained that the framework is structured from zero per cent to a maximum of 30 per cent, which is set to reduce to 25 per cent, with 99 per cent of investors entitled to unconditional exemption.
He dismissed fears of a market sell-off, noting that any disposals in December 2025 would have benefited from reinvestment exemptions or enhanced deductions under the new law.
Regarding the commencement date of the laws, Oyedele argued that aligning strictly with accounting periods takes a narrow view of the complex transition issues involved in a comprehensive tax overhaul spanning multiple periods, audits, deductions, credits, and penalties.
On indirect transfer of shares, he described the provision as a deliberate policy choice aligned with global best practices and BEPS initiatives, aimed at closing long-exploited loopholes by multinationals.
The Chairman clarified that insurance premiums are not subject to Value Added Tax, as insurance does not constitute a taxable supply under the Nigeria Tax Act, making specific exemptions unnecessary.
Addressing the definition of ‘community’, he noted that the statutory definition applies throughout the law unless context requires otherwise, and the use of “includes” makes the list of taxable persons non-exhaustive.
On dividend taxation, Oyedele explained that dividends from foreign companies could not be franked because no Nigerian withholding tax would have been deducted, describing the differential treatment between domestic and foreign dividends as a deliberate policy decision.
He also defended disallowing deductions on foreign exchange transactions at parallel market rates as a fiscal policy tool to complement monetary policy objectives.
Linking tax deductibility to VAT compliance was presented as an anti-avoidance measure, while the Police Trust Fund, which expired in June 2025, rendered calls for its repeal unnecessary.
Issues concerning small company exemptions were noted to predate the new laws, having been introduced under the Finance Act 2021.
Oyedele assured that minor clerical inconsistencies or cross-referencing gaps identified internally will be addressed through administrative guidance and regulations.
He described the tax reform as a bold step toward a self-sustaining and competitive Nigeria, urging stakeholders to focus on constructive engagement for successful implementation.
The clarification follows KPMG Nigeria’s report, which highlighted potential errors, gaps, and inconsistencies in areas including share taxation, dividend treatment, non-resident obligations, and foreign exchange deductions.
