Tinubu’s Tax Overhaul Targets Wealth, Spares Retail

Nigeria’s finance ministry is revising capital gains tax rules to exempt small investors while tightening the net on high-income portfolios. The reform, part of Tinubu’s fiscal reset, balances short-term equity-market sentiment against the need for durable revenue. Effective from Q1 2026, the policy introduces progressive brackets above ₦10 million, aligning rates to income categories and asset type. Analysts estimate up to ₦280 billion in annual yield gains.

This marks Nigeria’s most material market-tax recalibration since 2011, widening compliance coverage without discouraging retail flow. The Nigerian Exchange (NGXASI) saw muted response; financials edged 0.4 % lower while domestic turnover held firm. The Treasury expects an improved non-oil tax ratio—now 8.7 % of GDP—to move toward 10 % by 2026 if the rollout avoids litigation risk.

Fiscal authorities intend to pair the measure with stricter brokerage reporting and real-time audit integration under the Federal Inland Revenue Service digitalization drive. The IMF previously flagged Nigeria’s “tax productivity gap” at 40 %, noting large capital markets leakage. With DXY ↑ 0.2 % and MSCI Frontier Africa flat, investor reaction remains orderly.

If credible enforcement and low-income carve-outs persist, Nigeria could gain rating headroom as debt-service ratios ease marginally below 74 % of revenues by 2026. The policy’s success will hinge on execution discipline and sustained capital-market confidence.