Households earning 250k less is exempted from tax – Oyedele

Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, Taiwo Oyedele, has announced that Nigerian households earning ₦250,000 or less per month will be classified as poor and exempt from paying taxes under the country’s new tax regime

Speaking on Politics Today on Channels Television on Thursday, Oyedele said the newly signed tax laws—approved by President Bola Tinubu—will take effect from January 2026 and are designed to boost economic growth, ensure fairness, and curb tax evasion, rather than simply raise revenue.

“This tax law will not put cash in your pocket, but at least it won’t take cash away if you are poor,” he said. “Nobody earning below N250,000 will have to pay taxes—they don’t even have enough to begin with.”

Oyedele, a former tax lead at PriceWaterhouseCoopers (PwC), explained that the reforms are intended to protect vulnerable households and businesses. The new system, he said, is more efficiency-driven, growth-oriented, and people-focused.

“We’ve eliminated taxes for those at the bottom, reduced them for middle-income earners, and made a slight increase for top earners,” he added.

The committee defines middle-class Nigerians as those earning between ₦1.8 million and ₦2 million per month. According to Oyedele, only about 5% of Nigerians fall into this category, and they will enjoy a reduction in their tax burden.

On how the N250,000 threshold was determined, Oyedele explained that the committee considered Nigeria’s rural economic realities, where many people grow their own food and incur minimal transportation costs.

“We asked ourselves: Who is really poor in Nigeria? The World Bank uses $2 per day, but that doesn’t reflect our context,” he said. “We developed a poverty benchmark based on a family of five with two income earners. After our calculations, N250,000 was the minimum needed to live modestly. Anyone earning that or less should not be taxed.”

Oyedele also noted that Nigeria currently collects only 30% of the taxes it should, and the aim of the reforms is to close the 70% gap—without burdening low-income earners.

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