Nigeria’s Federal Inland Revenue Service (FIRS) has reaffirmed that all legal practitioners must pay the 7.5% Value Added Tax (VAT) on their services starting January 1, 2026. The enforcement marks a key milestone in President Bola Tinubu’s fiscal reform agenda aimed at promoting fairness and accountability.
At the 56th Annual National Conference of the Nigerian Association of Law Teachers (NALT) in Abuja, FIRS Chairman Zacch Adedeji explained the rationale behind the new directive. Represented by Bright Igbinosa, Head of the Tax Policy Reform Unit, Adedeji said the law will promote equity in professional taxation and enhance compliance across the economy.
He stressed that the reform was designed to expand Nigeria’s tax base and reduce dependence on volatile oil revenues. According to him, professionals must now contribute their fair share toward national development, as their services command high value.
However, the Federal Inland Revenue Service clarified that certain groups remain exempt. These include traders, military officers, and workers earning below ₦800,000 yearly. Small businesses generating less than ₦100 million annually also fall outside the VAT requirement. If VAT is wrongly charged, affected individuals can apply for a refund within 30 days.
Adedeji noted that the new framework empowers the FIRS to appoint third parties to recover taxes from Nigerians living abroad. This move, he said, ensures broader enforcement and strengthens the country’s global tax compliance record.
As discussions unfolded, some participants raised concerns about the impact on young lawyers and start-ups. Responding, Adedeji emphasized that the government does not intend to punish professionals but to create a balanced system. He added that comparing professionals with traders would be unfair since legal services often generate higher profit margins.
He assured the audience that the Federal Inland Revenue Service would continue working closely with professional bodies such as the Nigerian Bar Association and NALT. Through ongoing consultations, he said, the agency will address valid concerns and ensure a smooth implementation by January 2026.
Professor Abiola Sanni, SAN, Dean of Law at the University of Lagos, described the new policy as a progressive step for fiscal modernization. He encouraged state governments to align with the reform by strengthening their tax structures and reducing revenue leakages.
Meanwhile, the Tinubu administration views tax reform as essential for achieving sustainable growth. By ensuring compliance and transparency, Nigeria aims to secure more reliable funding for infrastructure, education, and healthcare. This shift also reflects a growing effort to stabilize the economy through non-oil revenue sources.
Ultimately, the Federal Inland Revenue Service insists that this reform is about fairness, not pressure. By engaging stakeholders and maintaining transparency, the agency seeks to build public trust and strengthen Nigeria’s fiscal foundation.
As January 2026 approaches, the government continues to urge professionals to register with the FIRS, file their returns promptly, and comply with the law. Through collective responsibility, Nigeria can achieve a more inclusive, transparent, and sustainable tax system that supports its long-term development goals.
