Nigeria’s plan to lift its capital positive aspects tax (CGT) from 10% to 25% beginning January 2026 has drawn combined reactions from buyers, with issues that the brand new regime may dampen capital inflows and complicate giant transactions.
The rise, contained within the Tax Reform Act signed in October 2025, marks a pointy departure from the nation’s longstanding 10% charge, which had made Nigeria one in every of Africa’s best low-tax jurisdictions for buyers.
Below the brand new construction, the 25% charge will apply solely to web capital positive aspects exceeding N150 million, and buyers shall be allowed to offset losses towards positive aspects.
As well as, CGT won’t apply if the proceeds from equities are reinvested in equities throughout the similar 12 months, supplied the reinvestment is in shares of a Nigerian firm. The present flat 10% regime, in contrast, taxes gross earnings with none deductions.
In keeping with the Presidential Committee on Fiscal Coverage and Tax Reforms, chaired by Taiwo Oyedele, the brand new design aligns Nigeria’s CGT with its company revenue tax charge and introduces equity into the system by guaranteeing that solely real earnings are taxed.
- “Below the previous regime, capital positive aspects on shares had been taxed at a flat charge of 10%, with no aid for capital losses and restricted exemptions,” Oyedele mentioned. “The brand new regime introduces progressive taxation, the place positive aspects are taxed primarily based on the payer’s revenue band, much like practices within the U.S., U.Okay., South Africa, Ghana, and Brazil.”
- “Our final aim is a fairer, easier, and growth-oriented tax system that builds investor belief whereas guaranteeing fiscal sustainability,” he added.
Nonetheless, analysts warn that the steep soar may scale back the nation’s funding enchantment, particularly for large-scale transactions akin to mergers, private-equity exits, and real-estate disposals.
“Even when small buyers are exempted, the notion issues,” a Lagos-based funding banker instructed Nairametrics. “A 25% charge places Nigeria nearer to the high-tax bracket, and that may affect how international funds assess exits.”
How Nigeria compares
For years, Nigeria’s 10% CGT mirrored Rwanda’s flat charge, a mannequin usually praised for simplicity and transparency.
Each international locations stood out for providing clear and predictable frameworks that supported long-term capital formation. That benefit could now fade as Nigeria joins a rising listing of African economies tightening their fiscal regimes.
In Ghana, authorities have additionally revised their CGT construction. In keeping with a reminder revealed by the Ghana Income Authority (GRA) and information compiled by PwC’s 2025
Worldwide Tax Summaries positive aspects on asset disposals could now be taxed at the usual company revenue charge of 25%, up from the earlier 15% utilized in restricted circumstances.
The change aligns CGT with Ghana’s company tax charge as a part of its fiscal-consolidation drive.
Throughout the continent, CGT charges range extensively. Rwanda maintains its 10% charge; Kenya expenses 15%; Morocco applies 20%; and South Africa imposes an efficient 21.6% on company positive aspects and 18% on people.
On the higher finish, Uganda taxes private capital positive aspects at 40%, whereas Namibia and Zambia at present don’t have any outlined CGT charge.
Analysts say the range displays a continent balancing fiscal ambition with competitiveness. Decrease charges entice funding however scale back income, whereas greater charges enhance collections on the danger of discouraging capital flows.
For Nigeria, the 25% CGT represents a shift towards fiscal boldness. Supporters argue it may scale back speculative buying and selling and encourage longer-term funding horizons.
However sceptics imagine the timing may damage market confidence, particularly amid excessive inflation, tight liquidity, and weak international participation within the equities market, as earlier highlighted in a Nairametrics report on worldwide buyers’ frustration with the coverage.
Nonetheless, fiscal specialists insist the reform may in the end strengthen Nigeria’s credibility if carried out predictably. By taxing solely web positive aspects and excluding most retail buyers, the federal government believes it has struck a good steadiness between competitiveness and fairness.
Nigeria’s new regime, like Ghana’s current adjustment, highlights a regional pattern towards harmonising capital taxation with broader income-tax buildings.
Whether or not that strategy drives income development or curbs investor urge for food will turn out to be clearer when the coverage takes impact in 2026.
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