The Federal Government has banned the mounting of roadblocks for tax and levy collection across Nigeria. The decision is part of a sweeping reform aimed at protecting small businesses and restoring order to tax administration.
At the same time, a new Presumptive Tax Framework (PTF) was signed to bring millions of informal businesses into the formal economy. The announcement was made on Tuesday, March 3, at the Ministry of Finance in Abuja.
The reform signals a major shift in Nigeria’s tax system. Moreover, it directly addresses long-standing complaints from traders, transport operators, and artisans who have faced harassment at illegal tax checkpoints.
Executive Secretary of the Joint Revenue Board, Olusegun Adesokan, confirmed the directive during the signing ceremony. “It also bans the mounting of roadblocks for the collection of taxes,” he said.
The Presumptive Tax Framework is designed to simplify tax compliance for micro and small enterprises. According to Adesokan, businesses with annual turnover of up to N50 million will be exempted from tax.
“It ensures that our nano and small businesses with an annual turnover of 50 million naira are exempted from tax,” Adesokan said.
He explained that this exemption will allow small entrepreneurs to grow before entering the formal tax net. Furthermore, other informal businesses above the threshold will pay a simplified turnover-based tax instead of complex assessments.
The framework also introduces strict digital compliance rules. “Apart from encouraging the use of technology for payment of taxes and cash collection, it bans all forms of cash collection by tax authorities,” he said.
Meanwhile, the Minister of Finance and Coordinating Minister of the Economy, Wale Edun, described the reform as a key part of President Bola Ahmed Tinubu’s tax reform agenda. He noted that the goal is to expand the tax base without raising tax rates.
“The objective of presumptive taxation is not to overburden small businesses, but to provide a fair, simple and predictable framework for tax compliance,” Edun said.
“Our fiscal strategy is anchored on expanding the tax base rather than increasing tax rates. Inclusion drives sustainability,” he added.
Edun stressed that micro and small enterprises are the backbone of Nigeria’s economy. Therefore, the system will rely on clear indicators such as turnover and business category. Complicated accounting records will not be required.
“Micro and small businesses are the backbone of Nigeria’s economy. This framework reduces compliance costs and provides a structured pathway into the formal sector,” he said.
He further assured taxpayers of transparency. “These regulations provide clarity to tax authorities and protect taxpayers from arbitrary assessments. The system will be transparent, rules-based and nationally consistent,” Edun stated.
In addition, the minister emphasized that a broader tax base will strengthen government revenue. “A stronger, more diversified revenue base enhances the government’s capacity to fund infrastructure, social investment, security and economic growth,” he said.
