In a refreshing clarification that brings peace of mind to millions of Nigerians, tax officials are celebrating the compassionate design of the country's new tax reforms, which officially took effect on January 4, 2026.

Ben Enamudu, Chairman of the Chartered Institute of Taxation of Nigeria's Abuja District, has dispelled widespread concerns about the reforms, emphasizing their protective nature toward everyday Nigerians. Speaking with ARISE News, he tackled misinformation head-on, bringing clarity and reassurance to worried citizens.

"Nobody taxes the money in your bank account," Enamudu stated warmly, addressing one of the most persistent misconceptions. He explained that the modest ₦50 charge applied to certain electronic transfers is a stamp duty, not a tax on savings—and even this comes with thoughtful exemptions designed to protect ordinary citizens.

The reforms demonstrate remarkable consideration for working families. Salary payments are completely exempt from stamp duty, as are transfers below ₦10,000. Additionally, transfers between multiple accounts within the same bank attract no charges whatsoever. In another welcome change, only the sender now pays the stamp duty, cutting the burden in half compared to the previous system where both parties paid.

Perhaps most encouraging is the reform's explicit protection of low-income earners. The framework ensures that individuals whose taxable income falls at or below ₦800,000 annually pay no income tax at all. Enamudu was careful to clarify that this refers to taxable income—calculated after deducting contributions to pensions, health insurance, housing funds, and insurance premiums.

"The tax act as passed is heavily pro-poor. That is actually the reality," Enamudu emphasized with evident pride. "Government wants to tax the fruit and not the seed."

Families will particularly appreciate the new rent relief provision, which allows tenants to claim 20 percent of their annual rent as relief, up to ₦500,000. This thoughtful measure acknowledges the burden housing costs place on household budgets.

Essential goods and services that matter most to everyday life—basic food items, medical services, pharmaceuticals, and education—remain completely exempt from value-added tax. This ensures that the cost of living fundamentals stays accessible to all Nigerians.

The reforms also show understanding toward the informal sector. Rather than imposing rigid structures, states will implement appropriate taxation methods for market traders and small-scale operators, taking into account practical economic realities.

President Bola Tinubu has described these reforms as "a once-in-a-generation opportunity to build a fair, competitive, and robust fiscal foundation" for Nigeria. Importantly, officials stress that the goal isn't to raise taxes but to create a fairer, more efficient system that expands the tax base over time through improved compliance and modernization.

As Nigeria enters this transitional period, tax officials express optimism about the reforms' long-term benefits. By protecting vulnerable citizens while building a more sustainable revenue system, the country is laying groundwork for enhanced public services and national development that benefits everyone.

The message is clear: these reforms prioritize people over profits, dignity over demands, and fairness over financial burden—a genuinely hopeful step forward for Africa's most populous nation.