The Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, Taiwo Oyedele, has clarified that small-scale investors in Nigeria’s capital market are fully exempt from paying capital gains tax, dismissing widespread misconceptions surrounding the country’s new tax regime.
Oyedele made the clarification at the Cowry Quarterly Economic Discourse themed “Nigeria in 2026: Will Politics Trump Economic Reform?”, where he explained that the 2026 tax reform law is deliberately structured to protect low-income earners, encourage investment and increase disposable income.
According to him, the law grants an automatic capital gains tax exemption to individuals whose total proceeds from asset disposals do not exceed ₦150 million, provided the gains are not more than ₦10 million within a 12-month period.
“The law says everyone is entitled to an exemption on capital gains tax. If the proceeds are not more than ₦150 million and the gain is no more than ₦10 million in 12 months, the exemption is automatic — no explanation and no conditions attached,” Oyedele said.
He added that pension fund administrators and real estate investment trusts (REITs) are also exempt from capital gains tax, as long as the proceeds are reinvested. According to him, high-net-worth individuals only become liable to the tax when they permanently exit investments without reinvesting.
“If a multi-billionaire sells shares worth ₦2 billion and decides not to reinvest, then tax is payable. But if the proceeds are reinvested, the law allows that exemption. What is paid instead is a minimal transaction cost, which actually stimulates market activity,” he explained.
Oyedele described Nigeria’s capital gains tax framework as one of the most competitive globally, noting that it promotes reinvestment, liquidity and long-term growth in the capital market. He assured investors that implementation regulations are being drafted to address grey areas, while any required legislative amendments will be forwarded to President Bola Ahmed Tinubu for consideration.
Addressing concerns about digital and virtual asset investments, Oyedele said most young Nigerians operate at very small scales, making fears of heavy taxation misplaced.
“These young people are not investing millions of dollars. They invest $50, $80 or $200. That is what adds up. Meanwhile, capital market investments offer better returns — even in dollar terms — and they are fully exempted,” he noted.
He warned that misinformation has discouraged youth participation in the stock market, with many wrongly believing that investment returns attract taxes as high as 30 per cent.
“If you ask young people on the street, they will tell you the stock market is taxed at 30 per cent, simply because nobody is telling them they are exempted,” Oyedele said.
Speaking on the broader goals of the 2026 tax reform law, Oyedele said the policy is designed to stop the taxation of poverty, protect low-income earners and ensure that Nigerians with a higher capacity to pay shoulder a fairer share of the tax burden.
Under the new framework, Nigerians earning the national minimum wage are completely exempt from personal income tax, while the taxable income threshold has been significantly raised after allowable deductions and reliefs.
“The ₦800,000 people talk about is taxable income, not gross income. After deductions and allowances, that translates to about ₦1 million to ₦1.2 million gross income. Even then, anyone earning the minimum wage pays no tax at all,” he explained.
Oyedele recalled that data previously presented to the Federal Government showed that about 96 per cent of personal income tax revenue in Nigeria came from low-income earners — a situation he described as unjust and economically unsustainable.
“We were taxing poverty. That is not how a functional economy works,” he said.