The Federal Inland Revenue Service (FIRS) has reaffirmed that Nigeria’s newly introduced tax laws are designed to enhance economic competitiveness, attract both local and foreign investments, and support long-term fiscal stability. The agency emphasized that the reforms are structured to make the tax system clearer, more efficient and more predictable for businesses.

A key clarification from FIRS concerns the widely discussed 4% Development Levy on imported goods. Contrary to public perception, the agency explained that this charge is not a new tax. Instead, it represents a consolidation of several existing levies—such as the Tertiary Education Tax, NITDA Levy, NASENI Levy and Police Trust Fund Levy—which businesses previously paid separately. By merging these charges into one streamlined levy, the government aims to reduce compliance stress and eliminate the unpredictability caused by multiple agencies issuing overlapping demands.

According to the agency, the new structure also provides targeted relief. Small businesses and non-resident companies are exempted from the levy, ensuring that firms most vulnerable to economic pressures are not burdened by additional obligations.

Analysts say this simplified approach sends a positive signal to investors, indicating that Nigeria is moving toward a more transparent and coordinated fiscal environment.

Another area of public concern has been the future of Free Trade Zones (FTZs). Early commentary suggested that long-standing incentives might be weakened. However, FIRS clarified that the reforms maintain the tax-exempt status of FTZ operators. The updated laws simply introduce clearer guidelines to ensure the zones continue serving their original purpose—promoting export-driven investment and industrial growth.

Overall, tax authorities believe that many of the controversies surrounding the new laws stem from misinterpretations. They maintain that the reforms are ultimately geared toward simplifying tax compliance, protecting genuine incentives, and creating a more competitive environment for economic growth.