By 
The Federal Government has inaugurated an inter-ministerial committee to draft the 2026 Value Added Tax (VAT) Modification Order, marking another step towards implementing Nigeria’s newly enacted tax reform framework.
The committee, inaugurated in Abuja by the Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, has been given six weeks to produce a comprehensive VAT framework that aligns with the provisions of the Nigeria Tax Act 2025, which came into effect on January 1, 2026.
According to the Ministry of Finance, the initiative is expected to improve regulatory compliance, simplify VAT administration, provide greater certainty for taxpayers, and strengthen Nigeria’s broader tax reform agenda.
New VAT Framework to Support Tax Reform Implementation
Speaking during the inauguration, Oyedele described the recently enacted Tax Reform Acts as the most significant overhaul of Nigeria’s tax system in decades.
He explained that the reforms are designed to modernise tax administration, improve policy clarity, strengthen investor confidence, promote economic competitiveness, protect vulnerable citizens and support sustainable economic growth.
According to the minister, the previous VAT Modification Order, which was issued under the repealed Value Added Tax Act, can no longer adequately support the country’s new legal and regulatory framework.
He stressed that the new order should not merely update existing provisions but establish a practical framework capable of addressing emerging business realities.
“This is not about reproducing an old document. It is about developing a VAT Modification Order that is clear, practical and responsive to the needs of a changing economy,” Oyedele said.
Committee to Review VAT Exemptions and Zero-Rated Supplies
As part of its mandate, the committee will review the legal, administrative and policy frameworks governing VAT administration, with particular attention to VAT-exempt and zero-rated supplies contained in Part IV of the Nigeria Tax Act.
The panel is expected to engage key stakeholders across government institutions, the organised private sector, professional associations and industry groups to validate classifications and resolve implementation concerns before the new order is finalised.
The committee will also develop a comprehensive schedule covering VAT-exempt and zero-rated goods and services, taking into consideration revenue implications, social impact, Nigeria’s international treaty obligations and regional integration commitments.
In addition, members have been tasked with identifying areas where legislative amendments may be required to strengthen implementation of the country’s new tax laws.
Focus on Investment, Industrial Growth and Regulatory Certainty
Oyedele emphasised that the VAT Modification Order should support broader economic objectives, including industrialisation, investment promotion, export growth, food security, innovation and Nigeria’s energy transition.
According to him, reducing uncertainty within the VAT system will benefit taxpayers, investors, regulators and tax administrators by creating a more transparent and predictable tax environment.
“Businesses need certainty. Investors need confidence. Government needs a VAT system that is easy to administer and supports growth,” the minister stated.
He urged committee members to approach the assignment with diligence, objectivity and urgency to ensure timely implementation of the country’s tax reform programme.
Six-Week Timeline for Draft Order
The committee has been directed to submit its recommendations within six weeks.
Its deliverables include:
- A draft 2026 VAT Modification Order.
- A harmonised schedule of VAT-exempt and zero-rated supplies with corresponding Harmonised System (HS) codes.
- Implementation guidelines for tax administrators and businesses.
- A report detailing stakeholder consultations.
- Recommendations on any legislative amendments required to improve implementation.
Multi-Stakeholder Membership
The committee comprises representatives from several public and private sector institutions involved in tax administration and economic policy, including:
- Federal Ministry of Finance
- Nigeria Revenue Service (NRS)
- Nigeria Customs Service (NCS)
- Federal Ministry of Industry, Trade and Investment
- Joint Revenue Board (JRB)
- Manufacturers Association of Nigeria (MAN)
- Tax Advisory Committee
- Tax Justice and Governance Platform
The broad-based representation is expected to ensure that the new VAT framework balances revenue generation with business competitiveness while supporting effective regulatory policy, compliance management, and long-term economic development.
Comments