What Nigeria’s New Levy Rules Mean for Businesses

At its 160th meeting in Kaduna, the Joint Revenue Board (JRB) said the more than 50 collection items previously administered by state and local governments have been reduced to nine subheads under the Model Harmonised Taxes and Levies Law. The JRB also said that 18 State Houses of Assembly had domesticated the model law.

That is a significant change, but the number alone does not tell businesses what has actually been consolidated.

What happened to the 50-plus collection items?

The old system contained a wide range of separate charges. Depending on the activity and location, these could include business premises charges, development levies, environmental fees, fire service fees, motor park levies, borehole fees, shop and kiosk fees, slaughter slab fees, domestic animal fees, vehicle and cart-related fees, signage charges, refuse disposal fees, liquor licence fees and various daily tickets.

The point of the reform is not simply to remove every one of these obligations individually. Instead, multiple related charges are being brought together under broader harmonised categories.

An enacted 2025 harmonised taxes and levies law in Ekiti State, which adopted the framework, illustrates how this works. Its schedule groups the collections into nine heads: Income Tax, Stamp Duties, Property Tax, Road Tax, Haulage Levy, Economic Development Levy, Harmonised Levy, User Charge and Daily Ticketing.

For example, the Economic Development Levy brings together several charges, including business premises, development levy, environmental fee, social service contribution levy, mining, milling and quarrying fees, emission control tax, produce sales tax, fire service fee, certain motor park levies and borehole fees. The Harmonised Levy also brings several local government charges together, including shop, stall and kiosk fees, slaughter slab fees, domestic animal fees and fees relating to bicycles, trucks, canoes, wheelbarrows and carts.

User Charges cover service-related payments such as signage and mobile advertising, refuse and sewage disposal, certain registration and permit fees and wharf landing charges. Daily Ticketing covers items such as market levies, animal trade tax, slaughter or abattoir fees and transporters’ tickets.

So when the JRB says the system has moved from more than 50 collection items to nine subheads, the important point is consolidation. Several individual charges that previously appeared as separate collection items can now sit under a smaller number of recognised categories.

What this changes for businesses

The reform is intended to reduce overlapping and duplicated taxation at the state and local government levels.

The model law also abolishes cash collection and the mounting of roadblocks for revenue collection.

That matters because a simpler list is only useful if businesses can also identify who is authorised to collect a charge and how payment should be made.

Under the Ekiti version of the framework, for example, the relevant tax authority is required to issue an electronic invoice for each tax, levy or fee and an official electronic receipt after payment. The law also prohibits unauthorised persons from imposing or collecting taxes and provides a mechanism for taxpayers to seek redress where a payment is demanded contrary to the approved schedule.

But there is an important qualification.

The JRB’s announcement does not mean that every state and local government has already implemented the framework in exactly the same way. The Board said 18 State Houses of Assembly had domesticated the model law, meaning implementation is still progressing across the states.

Businesses should therefore avoid assuming that every levy they previously encountered has automatically disappeared nationwide.

The practical approach is to establish what a charge is, which category it falls under, which authority is responsible for collecting it and the approved payment method. Businesses should also keep their assessments, invoices, receipts and other payment records.

For small businesses in particular, the intended benefit is a reduction in the number of separate collection points and nuisance charges. The JRB says the reforms have reduced the burden on low-income earners, eliminated multiple nuisance taxes and provided relief for micro-scale businesses.

Whether businesses experience that improvement consistently will depend on how the harmonised framework is implemented across individual states and local governments.

For now, the bigger story is not simply that more than 50 collection items have become nine. It is that Nigeria is moving towards a more consolidated framework for subnational revenue collection, where multiple related charges can be grouped under defined categories rather than appearing as a long list of separate demands.

For businesses, understanding what you are being asked to pay and keeping the evidence of what you have paid will remain important as the new system takes shape.

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