Clarity Crisis: Professional Feedback Tests Nigeria’s Tax Overhaul
“Experts and Execution: Can Nigeria’s Tax Law Reforms Weather Ambiguity?”
The Stage: Nigeria’s Tax Law Overhaul
NIGERIA’S sweeping tax reforms — brought into effect on 1 January 2026 through the Nigeria Tax Act (NTA) and supporting legislation — aim to simplify the tax system, eliminate nuisance levies, and make taxation more efficient and equitable.
While the reforms have been touted by government as transformative, they have also sparked detailed commentary from professional services firms and financial analysts. Among the most notable has been KPMG Nigeria’s review, which highlighted multiple “errors, inconsistencies, gaps and omissions” in the new framework.
KPMG’s Technical Concerns
KPMG’s publication did not reject the logic of the reforms outright but flagged areas that could pose interpretative or operational challenges once put into practice. Among issues raised were:
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Clauses relating to how income for non-residents should be taxed and administered.
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Lack of clarity on whether communities should be included or exempt under certain tax categories.
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Ambiguities in business expense deductions that could expose companies to unintended tax liabilities.
These points, KPMG argued, risked undermining the law’s goals of transparency and certainty if left unaddressed.
Government’s Pushback and Clarifications
The government’s fiscal policy committee responded forcefully, asserting that most criticisms reflected misunderstandings of policy intent rather than genuine legislative faults.
Chairman Taiwo Oyedele and others faulted KPMG for interpreting policy choices as errors, noting that:
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Some critiques were based on incorrect readings of reform objectives.
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Several “issues” pre-dated the new laws and were carried over from existing statutes.
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Disagreements over tax policy direction are legitimate — but not necessarily technical flaws.
This response was reinforced by subsequent meetings between KPMG executives and the Nigeria Revenue Service (NRS), where misunderstandings were clarified and discussion emphasised implementation support.
What This Means for Implementation
At its core, the clash reveals a broader tension in public finance reform: the gap between law design and practical execution.
While KPMG’s scrutiny highlights potential practical issues, the government’s response stresses preserving the intent and integrity of policy decisions. The real test now lies in how these interpretations translate into regulations, administrative guidance, and taxpayer compliance procedures.
With both sides publicly engaging and clarifying, there is at least a foundation for constructive dialogue — a necessary ingredient if Nigeria’s tax overhaul is to achieve its ambitious objectives.
