PAYE Cut Boosts January Salaries As Tax Reforms Take Effect — Oyedele
Early Gains from Tax Reforms
NIGERIAN workers have begun to feel the impact of the country’s newly enacted tax reforms, with many recording higher take-home pay following a reduction in Pay As You Earn (PAYE) deductions, according to the Chairman of the Presidential Fiscal Policy and Tax Reforms Committee, Taiwo Oyedele.
Oyedele disclosed this on Monday in a post on X, where he shared feedback from salary earners who had already received their January 2026 wages. He said early indications showed that the revised PAYE structure was already easing the tax burden on workers, particularly those whose income taxes are deducted directly at source.
January Salaries Show Immediate Impact
According to Oyedele, several employees reported noticeable reductions in PAYE deductions on their January payslips, translating into higher disposable income at a time when many households are grappling with rising living costs.
“We are pleased to note the feedback from workers who have received their salaries for January 2026 and confirmed a reduction in their PAYE tax resulting in higher take-home pay under the new tax laws,” he said.
He explained that the early impact of the reforms was especially evident among salaried workers in both the public and private sectors, whose tax obligations are automatically calculated and remitted by their employers.
Focus on Disposable Income
The PAYE adjustment forms part of a broader package of tax reforms introduced by the federal government to simplify tax administration, reduce excessive tax pressure on individuals, and stimulate economic activity.
Officials say the reforms are designed to leave more money in the hands of workers, thereby increasing disposable income and boosting consumer spending, which in turn could support economic growth.
Oyedele noted that while the reforms are still in their early stages, the PAYE reductions provide an important signal of the government’s intention to rebalance the tax system in favour of ordinary Nigerians.
More Changes Expected
The tax reforms, which took effect at the beginning of 2026, are expected to roll out in phases, with further adjustments anticipated as implementation continues. Authorities have indicated that the government will continue to monitor feedback from taxpayers and employers to ensure the reforms achieve their intended goals.
For many workers, the January salary experience has offered the first tangible evidence that the reforms may translate into real financial relief, beyond policy announcements.
