Court Rejects Attempt To Halt January 1 Tax Laws Rollout

An Abuja High Court has cleared the way for the implementation of Nigeria’s new tax laws scheduled to take effect from January 1, 2026, after dismissing a suit seeking to halt the reforms.

The ruling grants the Federal Government, the Federal Inland Revenue Service (FIRS) and the National Assembly full legal backing to proceed with the rollout of the new tax regime.

The suit was filed by the Incorporated Trustees of African Initiative for Abuse of Public Trustees against the Federal Republic of Nigeria, the President, the Attorney-General of the Federation, the President of the Senate, the Speaker of the House of Representatives and the National Assembly, over alleged discrepancies in the recently enacted tax laws.

In an ex parte application, the plaintiff sought an interim injunction restraining the Federal Government, FIRS, the National Assembly and other relevant agencies from implementing or enforcing the Nigeria Tax Act, 2025; Nigeria Tax Administration Act, 2025; Nigeria Revenue Service (Establishment) Act, 2025; and the Joint Revenue Board of Nigeria (Establishment) Act, 2025, pending the determination of the substantive suit.

The group also asked the court to restrain the President from implementing the laws in any part of the federation pending the hearing of its motion on notice.

Delivering a ruling on Tuesday, Justice Bello Kawu struck out the application, holding that it lacked merit and failed to disclose sufficient legal grounds to justify the grant of the reliefs sought.

The court held that the plaintiffs did not demonstrate how the implementation of the new tax laws would occasion irreparable harm or amount to a violation of any provision of the Constitution.

Justice Kawu stressed that issues bordering on fiscal policy and economic reforms fall squarely within the powers of government.

The judge further ruled that once a law has been duly enacted and gazetted, any alleged errors or controversies arising from it can only be addressed through legislative amendment or by a substantive court order.

He noted that disagreements or objections to tax laws cannot, on their own, justify stopping the implementation of an existing law.

Consequently, the court affirmed that there was no legal impediment to the commencement of the new tax regime and directed that implementation should proceed as scheduled from January 1, 2026.

The new tax regime is anchored in four major tax reform laws signed in 2025 as part of the Federal Government’s broader fiscal and economic reform agenda, aimed at boosting revenue, simplifying the tax system, and reducing leakages.

The laws — the Nigeria Tax Act, 2025; Nigeria Tax Administration Act, 2025; Nigeria Revenue Service (Establishment) Act, 2025; and the Joint Revenue Board of Nigeria (Establishment) Act, 2025 — replace several existing tax statutes, including those governing companies’ income tax, personal income tax, value added tax, capital gains tax and stamp duties.

Key elements of the reforms include the harmonisation of multiple taxes into a streamlined framework, expansion of the tax base, protection for low-income earners and small businesses, and the introduction of technology-driven tax administration systems such as digital filing and electronic compliance monitoring.

The reforms also provide for the restructuring of federal tax administration, including the creation of the Nigeria Revenue Service, to strengthen efficiency, coordination and revenue collection across different levels of government.