No Inheritance Tax in Proposed Tax Reforms, Oyedele Clarifies
By Patience Ikpeme
The Chairman of the Presidential Fiscal Policy and Tax Reform Committee, Taiwo Oyedele, has cleared the air regarding the widely circulated misinformation about the inclusion of an inheritance tax in the proposed tax reform bills.
In a post on his X (formerly Twitter) handle, Oyedele categorically stated that there is no provision for inheritance tax, either directly or indirectly, in the bills. He stated that inheritance tax was abolished in Nigeria in 1996 with the repeal of the Capital Transfer Tax Decree.
Oyedele explained that inheritance, whether a gift during the lifetime of the giver or a transfer upon death, is a one-time event. In contrast, the family income covered by the tax bills is recurrent, making it subject to taxation.
Section 4 of the Nigeria Tax Bill outlines the types of income chargeable to tax, including income earned by a family. However, this provision applies to recurring income, not one-time inheritances. Oyedele noted that this is a standard practice in tax laws and has been in effect in Nigeria for many years.
He further clarified that in cases where a family’s income is pooled and individual shares are indeterminate, tax may only be imposed on the member who initially receives the income in Nigeria.
Oyedele concluded by stating that individual income earners will be taxed accordingly, and groups of individuals, such as partnerships, communities, or families, will also be subject to tax on their joint income, provided their individual shares can be determined. This measure aims to ensure fairness and prevent potential tax loopholes.
