The Nigeria Labour Congress (NLC) has issued a strong warning over the Federal Government’s plan to commence the implementation of newly enacted tax reform laws from January 1, 2026, threatening widespread resistance if concerns raised by workers and other stakeholders are not urgently addressed.
The labour union faulted both the process and substance of the reforms, stressing that organised labour was excluded from consultations before the bills were drafted, passed by the National Assembly, and signed into law by President Bola Tinubu. According to the NLC, this exclusion is unacceptable, particularly because workers constitute one of the largest tax-paying groups in the country.
The planned rollout of the tax reforms has triggered sharp divisions among key stakeholders. While labour unions, small business operators, and employment agencies are calling for suspension and further engagement, the Manufacturers Association of Nigeria (MAN) has publicly endorsed the laws, describing them as progressive and business-friendly.
The tax reform framework became law on June 26 following the President’s assent to four major bills—widely described by the Federal Government as the most comprehensive overhaul of Nigeria’s tax system in decades. The new legal framework comprises the Nigeria Tax Act, the Nigeria Tax Administration Act, the Nigeria Revenue Service (Establishment) Act, and the Joint Revenue Board (Establishment) Act. Together, these laws consolidate tax administration under a single authority, the Nigeria Revenue Service, which is expected to replace the Federal Inland Revenue Service (FIRS).
However, controversy deepened last week after a member of the House of Representatives, Abdussamad Dasuki (PDP, Sokoto), alleged discrepancies between the versions of the tax bills passed by lawmakers and those later gazetted and made public. He insisted during plenary that the documents released to the public did not accurately reflect what legislators debated and approved, further fuelling mistrust around the reforms.
Speaking on behalf of the NLC, its spokesperson, Benson Upah, said organised labour had rejected the tax laws outright, citing lack of transparency, poor communication, and absence of stakeholder inclusion.
Upah expressed dismay that despite being a major contributor to government revenue through taxation, workers were left uninformed about the content, objectives, and implications of the new laws.“
At the level of the congress, we do not even know what these laws contain, yet we are the largest tax-paying community in the country. There has been no sensitisation or public enlightenment targeted at organised labour. This is a serious affront and a clear disrespect to citizens,” he said.
He argued that access to information about public policy is a fundamental right, not a privilege granted at the discretion of government. According to him, labour’s demand is straightforward: comprehensive public education, clarity on beneficiaries of the reforms, and transparency in implementation before enforcement begins.
The NLC also raised concerns over reports suggesting the introduction of tax agents to enforce compliance, a move Upah described as vague and unacceptable in the absence of clear guidelines.
“The entire process of tax collection, storage of proceeds, and utilisation must be transparent. If this is not done, there will be resistance—not just from labour, but from citizens across the country,” he warned.
Upah further criticised the decision to exclude labour from the tax reform committee, despite repeated calls for representation.
“We are the largest tax-paying community. How can decisions of this magnitude be taken without our input? Since the committee concluded its work and the bills became law, nobody has deemed it necessary to engage or enlighten us. That is a serious snub,” he said.
He added that high and opaque taxation discourages compliance, whereas transparent and fair systems promote voluntary participation. In his view, failure to address these concerns could spark nationwide unrest.
A senior NLC official, who spoke anonymously, echoed these sentiments and disclosed that organised labour had demanded the outright repeal of the laws. He accused the Federal Government of deliberately sidelining workers and warned that labour would resist any policy that deepens economic hardship for Nigerians already struggling with rising costs of living.
Beyond organised labour, private sector groups—particularly those representing small and medium-scale enterprises—have also expressed strong reservations about the timing and readiness for implementation.
The President of the Association of Small Business Owners of Nigeria (ASBON), Femi Egbesola, cautioned that enforcing the reforms without adequate understanding among micro, small, and medium enterprises (MSMEs) could undermine their success.
According to him, most MSMEs lack sufficient awareness of the reforms, making immediate implementation unrealistic and potentially counterproductive.
“You cannot successfully implement what people do not understand. If you proceed without adequate education, there will be misalignment, poor compliance, and the reforms may ultimately fail,” Egbesola said.
He also questioned the preparedness of the proposed Nigeria Revenue Service to effectively monitor economic activities across the country, particularly within the largely informal MSME sector.
Egbesola cited data from the Small and Medium Enterprises Development Agency of Nigeria indicating that micro and small businesses account for about 87 per cent of Nigeria’s estimated 40 million MSMEs. He stressed that engaging this segment requires targeted communication strategies rather than broad policy announcements.
“These micro businesses require a different approach to sensitisation. Those responsible for public enlightenment must do more,” he said.
He warned that inadequate awareness could lead to resistance, low compliance, and even protests, and called for a pilot phase of at least two to three months before full enforcement of the laws.
Similarly, the Executive Secretary of the Employers Association for Private Employment Agencies of Nigeria (EAPEAN), Jide Afolabi, supported calls for a temporary suspension of implementation.
Afolabi argued that the alleged discrepancies between the passed bills and the gazetted versions must first be resolved to prevent confusion and unintended compliance issues.
“A brief pause will allow reconciliation of the documents, wider stakeholder engagement, and the issuance of clear implementation guidelines. This will ultimately promote acceptance and smoother compliance,” he said.
In contrast, the Manufacturers Association of Nigeria has thrown its weight behind the tax reforms, expressing optimism that the new framework will ease long-standing challenges faced by businesses.
The Director-General of MAN, Segun Ajayi-Kadir, said manufacturers anticipate significant relief from what he described as multiple nuisance taxes imposed by sub-national authorities.
According to him, the reforms promise an end to harassment, illegal levies, and roadblocks often encountered by manufacturers.
“We are looking forward to operating without constant disruptions from officials collecting official and unofficial taxes. The economy will benefit, and businesses will thrive,” he said.Ajayi-Kadir noted that MAN actively participated in stakeholder engagements and is confident that the laws are well-positioned to support businesses of all sizes.
He highlighted provisions exempting companies with annual turnovers below ₦100 million from company income tax, value-added tax, and withholding tax, describing them as a major relief for struggling small enterprises.
He added that reductions in company income tax align Nigeria with global best practices and create opportunities for reinvestment and increased foreign investment. According to him, low-income earners would be exempt from tax, while middle-income earners would benefit from expanded reliefs.
The MAN director-general also praised the introduction of a tax ombuds, describing it as a crucial safeguard for taxpayers against abuse by tax authorities.
“The tax ombuds will offer much-needed protection and restore confidence in the system. From our assessment, no category of earners will be worse off under the new regime,” he said.
He concluded that even high-income earners, who will face higher tax rates, would be adequately compensated through broader corporate benefits under the reformed system.
