The Nigeria Income Service (NRS) has refuted narratives making spherical within the media suggesting the imposition of Worth Added Tax (VAT) on banking providers corresponding to digital cash switch, charges and commissions within the new Nigeria Tax Act.
The service describes the experiences as incorrect and deceptive, as VAT has at all times utilized to banking providers and was by no means newly launched underneath the brand new tax regulation.
This disclosure is contained in a press release issued by the Particular Adviser on Media to the NRS Chairman, Dare Adekanmbi, and made obtainable to newsmen on Thursday, January 14, 2026.
What the NRS is saying
Adekanmbi, on behalf of NRS, defined that the Nigeria Tax Act didn’t introduce VAT on banking expenses, nor did it impose any new tax obligation on prospects on this regard.
The assertion reads, “The Nigeria Income Service (NRS) needs to deal with and proper deceptive narratives circulating in sections of the media suggesting that Worth Added Tax (VAT) has been newly launched on banking providers, charges, commissions, or digital cash transfers. This declare is categorically incorrect.
“VAT has at all times utilized to charges, commissions, and expenses for providers rendered by banks and different monetary establishments underneath Nigeria’s long-established VAT regime. The Nigeria Tax Act didn’t introduce VAT on banking expenses, nor did it impose any new tax obligation on prospects on this regard.
“The Nigeria Income Service urges members of the general public and all stakeholders to ignore misinformation and to rely solely on official communications for correct, authoritative, and up-to-date tax info.’’
Incessantly requested questions on VAT
The assertion additionally included a listing of Incessantly Requested Questions (FAQs) on VAT because it pertains to the tax regulation with the intention to present additional readability on different areas of concern to Nigerians.
Listed below are the next clarifications to additional handle some public issues and stop misunderstanding
Q1: Is VAT charged on banking providers?
Sure, the place a price or fee is charged for a service.VAT applies to commissions, charges, and expenses for providers rendered by banks and different monetary establishments, corresponding to switch charges, USSD expenses, card issuance charges, account upkeep charges, and comparable service expenses. This has at all times been the place underneath Nigerian VAT regulation, and was not launched by the Nigeria Tax Act.
Q2: Does VAT apply to the cash I switch or withdraw?
No. VAT isn’t charged on the amount of cash transferred or withdrawn. It applies solely to the service cost or fee imposed by the bank. For instance, if a bank expenses ₦10 for a switch, VAT of seven.5% (₦0.75) applies to that ₦10 cost—to not the quantity being transferred.
Q3: Is VAT charged on financial savings account curiosity or curiosity on bank deposits?
No. Curiosity earned on financial savings accounts, fastened deposits, and comparable deposit accounts isn’t topic to VAT. Curiosity earnings isn’t a provide of products or providers and due to this fact doesn’t entice VAT underneath the Nigeria Tax Act, 2025.
This autumn: Are primary meals gadgets and important items topic to VAT?
No. The Nigeria Tax Act expressly exempts primary meals gadgets and important items from VAT with the intention to shield shoppers and cut back the price of residing. These exemptions are clearly listed underneath the VAT exemption provisions of the Act.
Q5: Are medical and pharmaceutical merchandise vatable?
No. Important medical providers and pharmaceutical merchandise are VAT-exempt underneath the Nigeria Tax Act, according to longstanding coverage to make sure entry to healthcare.
Q6: Are instructional providers topic to VAT?
No. Tuition and core instructional providers offered by recognised instructional establishments are exempt from VAT underneath the Act.
Q7: What precisely modified lately if VAT isn’t new?
What modified is compliance and enforcement, not the regulation. Monetary establishments are being reminded of their present obligation to remit VAT already charged and picked up from prospects, according to the Nigeria Tax Act.
Q8: Did the Nigeria Tax Act introduce any new VAT burden on odd Nigerians?
No. The Act didn’t introduce VAT on financial savings, primary meals, medical care, schooling, or important consumption. Claims suggesting in any other case are deceptive and incorrect.
What you need to know
Recall that in June 2025, President Bola Tinubu signed into regulation 4 tax reform payments on key areas of Nigeria’s fiscal and income framework.
The 4 payments embody: the Nigeria Tax Invoice, the Nigeria Tax Administration Invoice, the Nigeria Income Service (Institution) Invoice, and the Joint Income Board (Institution) Invoice.
A few of these tax legal guidelines took impact on June 26, 2025, whereas others have been as a result of start on January 1, 2026.
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