Minister of Finance and Coordinating Minister of the Economy, Mr Wale Edun, yesterday said the Federal Government would engage in further consultation and review the provisions on Capital Gains Tax (CGT) in order to ensure the tax reform serves the best interest of the economy.
Speaking yesterday at the listing of the MOFI Real Estate Investment Fund (MREIF) on the Nigerian Exchange (NGX) in Lagos, Edun said the government had taken note of concerns from stakeholders on the CGT.
“We have heard what you have said about capital gains tax. We are looking at it. We will listen. We will analyse. We will discuss and we will, at the end of it, decide, and hopefully we will decide what is best for Nigeria,” Edun said.
The new tax laws, which become effective January 2026, introduces a progressive CGT which ranges as high as 30 per cent, as against the previous flat 10 per cent rate.
Many analysts have linked recent steep decline at the Nigerian stock market partly to anxieties around the CGT, with stakeholders calling for clarity and further consultation around the new tax provision.
Chairman, Presidential Fiscal Policy & Tax Reforms Committee, Mr Taiwo Oyedele, however explained yesterday recent discussions around the impact of the CGT reform on the capital market have included some misinterpretations and misinformation.
According to him, while detailed implementation guidelines would be provided through official regulations, it is important to clarify the critical issues at this stage.
“The new CGT framework represents a major improvement over the existing law. The reform makes investment in the Nigerian capital market more attractive, reduces investment risk, and ensures fair treatment of legitimate costs incurred by investors. In essence, the reform promotes equity and confidence in the market – not the reverse,” Oyedele said, in explanatory notes posted on his X (formerly Twitter) handle.
Edun reassured the investing public that the President Bola Tinubu’s administration remains committed to fostering investment friendly environment, highlighting the critical importance of private capital in the economic growth agenda of the government.
According to him, the government reforms were aimed at engendering stability, liquidity and growth as basis for sustainable economic growth.
He added that the government recognises the importance of the capital market and would act with care to ensure the best results for the economy and the general investing environment.
Edun said the listing of the commercial tranche of MREIF reaffirmed President Bola Ahmed Tinubu’s commitment to addressing Nigeria’s housing deficit through innovative, market-driven financing models.
“The MREIF represents a transformative approach to affordable housing—mobilizing private and institutional capital into the housing sector, creating jobs, and stimulating economic growth.
“With strong credit ratings of AAA by Agusto & Co and AA by GCR, the Fund demonstrates investor confidence and provides a sustainable model for financing social infrastructure through public-private partnerships,” Edun said.
He noted that the MREIF is already operational, with over 1,000 mortgages created since disbursements commenced in May 2025 —demonstrating the Fund’s early impact and scalability.
Chairman, Ministry of Finance Incorporated (MOFI), Dr. Shamsuddeen Usman, described the listing as a major leap forward in deepening Nigeria’s capital markets and unlocking the potential of real estate as a driver of inclusive growth.
He said: “The MREIF is more than an investment instrument—it is a catalyst for progress and inclusion. Through MOFI’s sponsorship, we are mobilizing private and institutional capital to address the housing and infrastructure needs of millions of Nigerians, while supporting the Federal Government’s vision of a dynamic and resilient economy that works for all.
“Today’s listing is more than a financial milestone—it is a tangible demonstration of how policy, capital, and purpose can intersect to deliver real impact. Through MOFI’s stewardship and the continued support of our partners, we are charting a new path defined by progress, prosperity, and opportunity for all Nigerians”.
Managing Director, Ministry of Finance Incorporated (MOFI), Dr. Armstrong Takang, highlighted MOFI’s role as the Federal Government’s investment vehicle and sponsor of the MREIF.
“This listing underscores MOFI’s mission to deploy capital strategically for national transformation. The MREIF is designed to provide long-term, low-cost mortgage financing, making homeownership a reality for millions while stimulating local economies across the housing value chain,” Takang said.
He commended the key transaction partners, Securities and Exchange Commission (SEC), and the Nigerian Exchange Group (NGX Group) for their professionalism and collaboration in structuring the MREIF to meet global standards of governance and sustainability.
He explained that the listing on NGX enhances the Fund’s visibility, liquidity, and investor diversification—creating opportunities for both institutional and retail investors, including the Nigerian diaspora, to participate in a socially impactful asset class. It also reinforces transparency and trust through NGX’s rigorous disclosure and governance framework.
He pointed out that with its public-private partnership (PPP) model, MREIF blends private capital and public policy to deliver long-term, affordable mortgage financing at scale—aligning with the Renewed Hope Agenda of the Tinubu administration.
Group Managing Director, Nigerian Exchange Group (NGX Group), Mr Temi Popoola underscored the importance of capital market as a catalyst for inclusive growth and called on the Federal Government to ensure balanced outcomes in the implementation of the Capital Gains Tax.
“The capital market is not only a platform for attracting investment but also a tool for creating wealth for Nigerians. Policies such as the capital gains tax must be carefully designed to balance government revenue objectives with investor confidence and market growth. NGX Group remains committed to supporting the Renewed Hope Agenda by channeling private capital into initiatives that deliver sustainable, long-term impact,” Popoola said.
Chairman, Nigerian Exchange (NGX), Ahonsi Unuigbe described the listing as a defining step toward transforming Nigeria into a leading economy that ensures shared prosperity for all Nigerians.
Chief Executive Officer, Nigerian Exchange (NGX), Jude Chiemeka said MREIF demonstrated how the capital market can deliver practical solutions to national challenges.
He said: “By channeling private capital into housing, we are creating opportunities for long-term investment and wealth creation while addressing Nigeria’s housing deficit”.
Oyedele outlined that the objectives of the CGT reform included reduction of investment risk by allowing deductions for capital losses and other investment-related costs, protection of small and institutional investors by providing exemptions for retail investors and tax-exempt institutions such as pension funds administrators (PFAs) and real estate investment trusts (REITs) and harmonisation and simplification of tax administration by aligning CGT with income tax rules to promote progressivity, consistency, and ease of compliance.
According to him, key changes included that in place of flat 10 per cent CGT rate, progressive income tax rates ranging from zero per cent to 30 per cent has been introduced, depending on the investor’s overall income or profit level.
“The top rate of 30 per cent, which applies to large corporate investors, is expected to be reduced to 25 per cent under the broader corporate tax reform. Investors may now deduct certain costs that were previously disallowed under the old CGT regime ensuring that they are not taxed on a net loss position,” Oyedele stated.
He listed exemptions under the new CGT framework to include disposals within 12 months where total sales proceeds do not exceed N150 million and total gains do not exceed N10 million, reinvestment of proceeds into shares of Nigerian companies within 12 months qualifies for full exemption where the general exemption threshold is exceeded and capital gains from foreign share disposals that are repatriated into Nigeria through CBN-authorised channels.
Other exemptions included institutional investors that enjoy corporate income tax exemption such as PFAs, REITs and NGOs are also exempted from CGT, small companies with turnover not exceeding N100 million and total fixed assets not more than N250 million pay zero CGT and gains from investment in a labeled startup by venture capitalist, private equity fund, accelerators or incubators.
In determining gains, Oyedele explained that for the purpose of CGT effective from January 1, 2026, the cost base for existing investments will be reset to the higher of the actual acquisition cost; and the closing market price as at December 31, 2025.
“This ensures fairness and prevents the application of the new rule to gains accrued before the new law takes effect,” Oyedele said.
He listed allowable deductions to include realised capital losses on share disposals, transaction charges such as brokerage fees and regulatory levies and expenses such as margin interest and realised foreign exchange losses proved to be incidental to the investment while exchange gains would be treated as taxable.
He noted the importance of registration and compliance as resident investors are required to register for tax and obtain a Tax ID while non-resident investors who earn only passive income such as dividends or capital gains are not required to obtain a Tax ID.
“Self-assessment is the default compliance model, though regulations may be issued to introduce withholding or presumptive deductions at source through brokers or exchanges. All applicable taxes are to be paid in naira,” Oyedele stated.
On filling and payment deadlines, individuals will have deadline of March 31 of the following year while companies will have deadline of within six months after the financial year-end.
Non-resident investors will act upon disposal of shares, except where reinvestment within the same year is expected. Brokers or exchanges may also be authorised to deduct CGT at source.
“Resident individuals are required to pay CGT to their state of residence in Nigeria. Resident companies are to file returns and remit applicable CGT to the Nigeria Revenue Service (NRS). Nonresident investors are to pay any applicable CGT to the NRS directly or through an appointed tax withholding agent,” Oyedele stated on administration.
He clarified that mergers, acquisitions, or internal restructurings as stipulated under the Nigeria Tax Act 2025 are exempted from CGT while gains earned on shares up to December 31, 2025 will be grandfathered and only taxed upon disposal where applicable, based on the law as at that date.
He said investors are expected to maintain documentation of acquisition costs, sales proceeds, and related expenses for audit and verification.
He pointed out that the reform was not revenue-driven but designed to achieve harmonisation, promote fairness, competitiveness, long-term interest and investor confidence in Nigeria’s capital markets.
“The new CGT framework makes the tax system fairer, more aligned with global practice, and friendlier to long-term investors. It reduces investment risks, protects small investors, encourages reinvestment, and simplifies compliance while ensuring that large and high-income investors who wish to exit the market contribute their fair share on realised gains that are not re-invested,” Oyedele stated.
