By Emmanuel Kwada
The Nigerian government has introduced a new tax law requirement for banks to report customer accounts with monthly transactions exceeding ₦5 million to the Federal Inland Revenue Service (FIRS) and other relevant tax authorities.
This directive aims to enhance tax compliance, promote fiscal transparency, and align Nigeria’s tax system with global best practices.
The new tax law also revises the Value-Added Tax (VAT) revenue distribution model, with the federal government set to receive 10% (down from 15%), state governments 55% (up from 50%), and local governments 35% (unchanged). Additionally, individuals earning up to ₦800,000 annually (₦66,667 monthly) are now exempt from personal income tax.
The move is expected to improve the government’s ability to track unreported income and enhance revenue generation from the informal and high-net-worth segments of the economy.
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