Oyedele Defends 30% Capital Gains Tax: “It Will Boost Business Valuation, Not Burden Investors”
Detailed Breakdown:
At the 31st Nigerian Economic Summit in Abuja, the Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, Taiwo Oyedele, clarified Nigeria’s new 30% Capital Gains Tax (CGT) policy — addressing widespread concerns and emphasizing its long-term economic benefits.
Oyedele explained that the revised CGT, which takes effect from January 2026, triples the rate for foreign equity investors selling Nigerian shares, unless the proceeds are reinvested in other local equities (whether listed or unlisted). According to him, the reform aims to encourage capital retention within the Nigerian economy rather than drive investors away.
However, Oyedele was quick to reassure that small businesses and low-income earners would not be affected.
“We have eliminated the special rate for capital gains tax. It now aligns with the income tax rate of the payer,” he said.
“If a small business pays zero per cent corporate tax, its capital gains tax is also zero. Likewise, low-income earners exempted from PAYE will pay no capital gains tax.”
He further clarified that investors who sell shares worth up to ₦150 million annually will be exempt — a threshold that covers over 99% of investors in Nigeria.
Oyedele argued that the reform would increase the valuation of Nigerian companies, since better fiscal stability and transparent policies enhance investor confidence.
“The valuation of any business is the present value of future cash flows. These reforms will significantly enhance the value of every company in Nigeria — such that the higher value will more than compensate for the additional tax,” he stated.
Beyond boosting valuations, Oyedele highlighted the government’s new digital monitoring and third-party validation systems, which will make tax evasion increasingly difficult.
“It is hard, if not impossible, to hide your spending even if you hide your income. If you earn income, you must pay tax,” he cautioned. ⚠️
To protect vulnerable groups, he disclosed that the government is introducing tax exemption stickers for nano businesses such as roadside traders and artisans, ensuring they remain shielded from undue tax pressure. ️
Oyedele also revealed that the committee had submitted about 10 amendment proposals to the National Assembly to eliminate obsolete taxes, including the bicycle tax, wheelbarrow tax, and radio levy — all of which no longer align with Nigeria’s modern fiscal landscape.
In closing, he expressed optimism that the recent rise in Federation Account revenues would strengthen state finances and prevent potential bankruptcies among subnational governments. ️
Summary Insight:
Oyedele’s clarification positions the new Capital Gains Tax as a strategic reform aimed at improving transparency, investor confidence, and fiscal sustainability — while also protecting small players from unnecessary tax burdens.
The message is clear: this reform rewards compliance, punishes evasion, and prioritizes growth.
Detailed Breakdown:
At the 31st Nigerian Economic Summit in Abuja, the Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, Taiwo Oyedele, clarified Nigeria’s new 30% Capital Gains Tax (CGT) policy — addressing widespread concerns and emphasizing its long-term economic benefits.
Oyedele explained that the revised CGT, which takes effect from January 2026, triples the rate for foreign equity investors selling Nigerian shares, unless the proceeds are reinvested in other local equities (whether listed or unlisted). According to him, the reform aims to encourage capital retention within the Nigerian economy rather than drive investors away.
However, Oyedele was quick to reassure that small businesses and low-income earners would not be affected.
“We have eliminated the special rate for capital gains tax. It now aligns with the income tax rate of the payer,” he said.
“If a small business pays zero per cent corporate tax, its capital gains tax is also zero. Likewise, low-income earners exempted from PAYE will pay no capital gains tax.”
He further clarified that investors who sell shares worth up to ₦150 million annually will be exempt — a threshold that covers over 99% of investors in Nigeria.
Oyedele argued that the reform would increase the valuation of Nigerian companies, since better fiscal stability and transparent policies enhance investor confidence.
“The valuation of any business is the present value of future cash flows. These reforms will significantly enhance the value of every company in Nigeria — such that the higher value will more than compensate for the additional tax,” he stated.
Beyond boosting valuations, Oyedele highlighted the government’s new digital monitoring and third-party validation systems, which will make tax evasion increasingly difficult.
“It is hard, if not impossible, to hide your spending even if you hide your income. If you earn income, you must pay tax,” he cautioned. ⚠️
To protect vulnerable groups, he disclosed that the government is introducing tax exemption stickers for nano businesses such as roadside traders and artisans, ensuring they remain shielded from undue tax pressure. ️
Oyedele also revealed that the committee had submitted about 10 amendment proposals to the National Assembly to eliminate obsolete taxes, including the bicycle tax, wheelbarrow tax, and radio levy — all of which no longer align with Nigeria’s modern fiscal landscape.
In closing, he expressed optimism that the recent rise in Federation Account revenues would strengthen state finances and prevent potential bankruptcies among subnational governments. ️
Summary Insight:
Oyedele’s clarification positions the new Capital Gains Tax as a strategic reform aimed at improving transparency, investor confidence, and fiscal sustainability — while also protecting small players from unnecessary tax burdens.
The message is clear: this reform rewards compliance, punishes evasion, and prioritizes growth.