News
FG Dismisses Amaechi’s Claim Of Imposing 25% levy On Building Materials In New Tax Law
The Federal Government has dismissed claims that the Nigeria Tax Act 2025 imposes a 25 per cent levy on building materials, construction funds, or bank balances.
Taiwo Oyedele, chairman of the presidential committee on fiscal policy and tax reforms, clarified the position in a statement shared on X on Sunday, responding to a viral video of former Minister of Transportation, Rotimi Amaechi.
Amaechi, while addressing a gathering, warned of looming economic hardship if the All Progressives Congress retains power in the 2027 elections.
“The tax law is if I pay you 100 million Naira for your building materials, automatically 25 million will leave your account.
“If you are a landlord and building a house, you will charge 25% extra because you won’t bear it alone; you will transfer it to the person who buys or rents,” the former minister said.
However, Oyedele described the claims — including assertions that the law would commence in 2027 and introduce a 25 per cent tax on construction-related transactions — as false.
“We are aware of a recent video claiming that the new tax laws will commence in 2027 and alleging the imposition of a 25% tax on funds for building materials and other transactions.
“Both claims are incorrect. Contrary to the misinformation seeking to create fear, panic and disaffection, the Nigeria Tax Act 2025 has already commenced and does not impose a 25% tax on construction funds, bank balances, or business expenses.
“Instead, it contains provisions specifically designed to reduce the cost of housing, rent and real estate development,” he said.
Oyedele outlined key provisions aimed at lowering housing costs. According to him, land and buildings are exempt from Value Added Tax under Section 185(l), while contractors may recover input VAT on materials, assets, and overheads where VAT applies.
He added that a reduced Withholding Tax rate of 2 per cent now applies to construction contracts, while mortgage interest is tax-deductible for individuals developing owner-occupied homes under Section 30(2)(iv).
Property owners earning rental income, he noted, can deduct related expenses such as repairs, insurance, and agency fees under Section 20 of the Act.
On renter relief, Oyedele said individuals may claim rent relief of up to N500,000, representing 20 per cent of annual rent, under Section 30(2)(vi). Rent is also exempt from VAT, and lease agreements valued below N10 million annually — or 10 times the annual minimum wage — are exempt from stamp duty under Section 134.
He further highlighted incentives for investors and developers, including Capital Gains Tax exemption for individuals disposing of a dwelling house under Section 51(1), and tax incentives for Real Estate Investment Trusts that distribute at least 75 per cent of their dividend or rental income within 12 months.
Manufacturers of building materials such as iron, steel, and domestic appliances qualify for priority sector incentives of up to 10 years, while large businesses may see Companies Income Tax reduced from 30 per cent to 25 per cent under Section 56.
Small companies, he added, benefit from zero per cent Companies Income Tax, exemption from charging VAT, and no Withholding Tax deductions on invoices and payments.
Oyedele stressed that the Act does not tax money in bank accounts or transfers for purchasing building materials, nor does it introduce any 25 per cent construction or business cost tax.
“The Act does not tax money in bank accounts or bank balances. It does not tax transfers for buying building materials. It does not introduce a 25% construction or business cost tax. It does not delay implementation until 2027,” he said.
Dismissing the viral claims, he concluded: “Fact not fear, evidence beats emotion. If anyone makes an alarming claim or tries to misinform you, ask them ‘Where is it in the law?’
“With the new tax laws, housing should become more affordable, and rent should go down, NOT up!”
-
Society News5 years agoJamaican man beheads wife after finding out their 6 kids are not his
-
Society News7 years agoEXCLUSIVE: The Complete Story of Dolapo Awosika, John Fashanu and Prophet Kasali Sex Mess
-
News6 years agoPastor Osagie Ize-Iyamu, His Membership Of Secret Cult, And Other Issues Touching On His Public Credentials Examined by Barr. PATRICK I. BIOSE
-
News6 years agoBREAKING: Ajimobi’s daughter-in-law blast Gov. Makinde, says gov can’t surpass ex-Oyo gov
-
Society News6 years agoThe Rise and Fall of “Jumoke The Bread Seller”
-
News6 years agoBREAKING: 2 arrested as NAF begins investigations into Tolulope’s death
-
Crime6 years agoExclusive: Female Aide Fingered In Oko Oloyun’s Murder + Banking Transactions That Nailed Husband
-
News6 years agoBREAKING: Police take over Edo House of Assembly as APC, Oshiomhole move to seize control
You must be logged in to post a comment Login