Four charts showing key numbers from Tax Reform Bills
By Aminu Abubakar
Chart 1: Individual income tax rate is pegged at 0% for the first N 800,000, next N2.2 million at 15%, next N9 million at 18%, next N13 million at 21%, next N25 million at 23% and next N50 million at 25%.
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Simply put, if you earn N800,000 annually, you will be exempt from individual income VAT.
Chart 2: The Value-Added Tax (VAT)on Companies is also pegged at zero percent for a small company and 27.5% for any other company in the 2025 year of assessment and 25% in the 2026 year of assessment.
A small company in Nigeria is a private organisation with an annual turnover of no more than N120 million and a net asset value of no more than N60 million.
Chart 3: The document also noted that the VAT rate will increase from the current 7.5% to 10% in 2025, 12.5% between 2026 and 2029, and 15% from 2030.
Chart 4: According to the section VAT net revenue “shall be distributed as follows; 10% to the Federal Government; 55% to the State Governments and the Federal Capital Territory; and 35% to the Local Governments.
The bill further notes that this development is provided that 60% of the amount standing to the credit of states and local governments shall be distributed among them on the basis of derivation.
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