Armed Forces, Another 33% of Nigeria's Workforce Exempted From Paying Income Tax
- The proposed tax reforms will exempt members of the armed forces, and another 33% of the Nigerian workforce from PAYE
- This includes low-income earners with a monthly salary of N83,000 or less, making up one-third of workers in Nigeria
- The tax committee is assuring Nigerian workers that the proposed reform provides for their welfare by also reducing tax for people earning up to N1.7 million per month
CHECK OUT: Education is Your Right! Don’t Let Social Norms Hold You Back. Learn Online with LEGIT. Enroll Now!
Legit.ng journalist Ruth Okwumbu-Imafidon has over a decade of experience in business reporting across digital and mainstream media.
Members of the Nigerian armed forces and others involved in fighting insecurity will be exempt from paying income tax, also known as Pay As You Earn (PAYE).
This is according to Mr Taiwo Oyedele, Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms.
In a detailed post on his LinkedIn account, Oyedele explained that the proposed tax reforms are pro-labour.
Source: Getty Images
He made this post in response to calls from the Nigerian Labour Congress (NLC) requesting that the bill be withdrawn from the National Assembly.
The post said:
“There will be PAYE tax exemption for members of the armed forces fighting insecurity in addition to other ranks”
Other groups exempted from PAYE
Mr Oyedele added that one-third of Nigerian workers in both the public and private sectors would be exempt from PAYE tax. This, he said, includes all low-income earners with a monthly salary of N83,000 or less.
Nigerian workers earning N1 million per annum or less will, therefore, be completely exempted from the PAYE tax.
The tax reforms would also reduce the tax burden of other Nigerian workers earning up to N1.7 million monthly, meaning that another 60% of the Nigerian workforce would end up paying lower taxes than they currently do.
This would free up more disposable income funds to be channelled into other living expenses and ease the lives of Nigerian workers.
Oyedele's post read further;
“We welcome the interest of the Nigeria Labour Congress (NLC) on the Tax Reform Bills. We note the concern expressed about the likely impact on the welfare of Nigerian workers. And to clarify, we outline below some of the key provisions of the tax bills aimed at improving the welfare of workers”
Other provisions to improve welfare of Nigerians
The proposed Tax reform bill also provides for zero Value Added Tax (VAT) on necessities, including food, education, and healthcare.
Other zero VAT items include transportation, CNG and fuel products, sanitary towels and baby products.
Lower taxes for the Nigerian workforce
In related news, Legit.ng reported that more than 90% of Nigerian workers will pay less taxes when the Tax reform bill takes effect.
Mr Oyedele compared the existing tax bills and the proposed reforms, showing how 90% of workers would pay less taxes under the new bill.
He explained that only those earning above N5 million monthly would pay higher taxes under the new Tax regime, adding that the bill is pro-poor.
PAY ATTENTION: Сheck out news that is picked exactly for YOU ➡️ find the “Recommended for you” block on the home page and enjoy!
Source: Legit.ng
