Rent below N10m exempted from stamp duty –Taiwo Oyedele

Taiwo Oyedele, Chairman of the Presidential Committee on Tax Reforms, has announced that the Nigerian government plans to exempt stamp duties on rent agreements below ₦10 million. This proposal is part of a broader tax reform initiative aimed at alleviating the financial burden on Nigerians and stimulating economic growth. 

Under the current Stamp Duties Act, stamp duty on lease or rent agreements is graduated based on the duration of the lease:

1. Less than 7 years: 0.78%
2. 7 to 21 years: 3%
3. Above 21 years: 6%

This means that for a lease term of less than 7 years, the applicable stamp duty rate is 0.78%. For example, on a ₦100,000 rent, the stamp duty would be ₦780. Given that most people enter into rent agreements for less than 7 years, the applicable stamp duty rate to most people will be 0.78%.

The exemption of stamp duties on rent agreements below ₦10 million is expected to simplify compliance for tenants and landlords, particularly in urban areas where rental costs are high. This move aligns with the government’s efforts to remove taxes on basic necessities, including food, accommodations, transportation, education, and health, to make them more affordable for Nigerians.