The Federal Government of Nigeria has rejected claims that the Nigeria Tax Act 2025 imposes a 25% levy on building materials, construction costs, bank balances, or business transactions. Officials described the claims as false and misleading.
The government also clarified that the law is already in force and does not wait until 2027 to take effect, contrary to what was suggested in a viral video.
Former Minister of Transportation, Rotimi Amaechi, publicly warned that the new tax law would automatically deduct 25% from payments for building materials and other transactions. He suggested this could lead builders and landlords to increase prices.
Government & Presidency Response
Officials, including members of the Presidential Fiscal Policy and Tax Reforms Committee, dismissed the claims as misinformation and politically motivated, particularly in light of the upcoming 2027 general elections.
The presidency further clarified that the top 25% personal income tax rate in the Act applies only to high-income earners’ taxable income after reliefs not to regular business transactions or construction payments.
What the Tax Act Actually Does
Rather than introducing new levies on building materials or bank transactions, officials stated that the Act:
Provides VAT exemptions for land, buildings, and rent.
Reduces withholding tax on construction contracts.
Offers tax relief on mortgage interest for homeowners and renters.
Supports real estate investment trusts (REITs).
Encourages investment in the housing sector.
The claim that the Tax Act 2025 introduces a 25% automatic levy on building materials or bank funds has been clearly denied by government authorities. Instead, the law is positioned as a reform aimed at supporting housing affordability and stimulating real estate development, rather than increasing costs.
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