AN APPRAISAL OF THE PERSONAL INCOME TAX UNDER THE NIGERIA TAX ACT, 2025

Abstract

Personal income tax is a form of tax that is paid on the income profit of gains of an individual who is gainfully employed, practicing a vocation or profession and carrying on a business other than a company. The law prescribed incomes which are taxable and exempted from tax. Some expenses incurred are allowed to be deducted from the total income before calculating the tax payable by the individual person. The recent promulgation of Nigeria Tax Act, 2025 has introduced a new dimension in the tax policy and administration of the government. The new Act was promulgated with the overall aim of ensuring that the tax law in tune with the current economic and social realities. Considering the emergence of Information Communication Technology (ICT) and Post COVID 19 which has heralded a new normal, there is the need for a legal framework that can cope with the new realities. It is on this premise that the Nigeria Tax Act, 2025 was promulgated. The paper examines personal income tax within the confine of the provision of the Nigeria Tax Act, 2025. The innovation introduced by the Act in terms of tax imposition on income and administration was examined. The paper concludes that the new Act leverages on the old legal framework to block loopholes and captured taxable persons and income within the tax net in a more transparent and accountable manner.