New Tax Law to Exempt Minimum Wage Earners from Income Tax Starting Jan 1st

The Federal Inland Revenue Service (FIRS) has confirmed a major relief measure for low-income earners as the countdown to the new tax regime continues. With just 17 days until the implementation of the new tax laws, the FIRS has highlighted that individuals earning the national minimum wage or less will be exempt from income tax.

This vital information was shared in a tweet by the FIRS as part of their ongoing public awareness campaign, “Know your Tax Laws.”

The graphic, powered by the FIRS’s Fiscal and Tax Reforms Implementation Division, draws attention to Section 163 (1)(t) of the Nigeria Tax Act (NTA).

The provision states clearly:

“Income of a person from an employment where such person earns national minimum wage or less from such employment are exempted from income tax.”

Official Confirmation from FIRS

The FIRS graphic serves as a direct confirmation of this policy, aimed at reducing the tax burden on Nigeria’s most vulnerable income groups.

What This Means for Taxpayers

This exemption is a significant development for employees on the national minimum wage. It ensures that their entire income from such employment is protected from direct taxation, providing much-needed financial relief.

Employers should also take note of this provision to ensure their payroll systems are updated to reflect this change once the new law takes effect on January 1st, 2026.

With the clock ticking down to the implementation date, itax.ng encourages all Nigerians to stay informed about the specific tax changes that will affect their finances in the new year.