He argued that the jump in CGT may make the country less attractive to investors, particularly for projects requiring significant capital.
Oyebanji also raised concerns about the new tax reporting requirements, saying that SMEs (small and medium-sized enterprises) may find it difficult to cope, as compliance may require technology investments (e.g. digital systems, computers).
He suggested there should be a transitional period to allow smaller businesses to adapt to the new rules gradually.
The tax reforms were signed into law on June 26, 2025, with one major component being that companies will now pay 30% on capital gains, aligning CGT with the corporate income tax rate.
For individuals, capital gains will be taxed according to their applicable progressive income tax band (rather than a flat 30%).
Possible Implications & Risks
1. Investor Confidence Erosion
A sudden jump in CGT could trigger risk-adjustment by investors. Projects that looked profitable under lower taxes may become less attractive, particularly in sectors with tight margins or long gestation periods.
2. Capital Flight or Avoidance
Some investors might delay or cancel planned investments, or look for tax jurisdictions with more favorable rules. There may also be increased use of legal tax avoidance strategies.
3. SME Vulnerability
Small businesses may struggle with the compliance burden (software, reporting systems, audits). The speed of implementation is critical — without transition periods, many SMEs could be overwhelmed.
4. Revenue vs Growth Tradeoff
While the government may collect more revenue in the short term, the long-term cost could be slower growth, lower foreign direct investment, and reduced dynamism in the economy.
5. Capital Structure Decisions
Firms may restructure deals (e.g. favor debt over equity) to minimize taxable gains. This could influence how companies are financed and may increase leverage risks.
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