The Nigerian Exchange Group (NGX) has unveiled a groundbreaking exemption plan for investors, offering N150 million annually under the newly introduced Capital Gains Tax (CGT) regime. This significant shift comes after an insightful dialogue held by NGX concerning the Tax Reform Act 2024, which promises to reshape the capital market landscape when it takes effect in January 2026.
Taiwo Oyedele, Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, addressed the forum, confirming that this provision will benefit 99.9% of retail investors by shielding them from the full 30% tax on gains arising from share disposals.
“The exemption from capital gains tax up to N150 million annually is a game-changer for small-scale investors who often face disproportionate tax burdens,” Oyedele stated during the forum. “This reform ensures that most retail investors can engage in the market without the heavy tax overhead, stimulating both investor participation and confidence.”
In an additional clarification, Oyedele noted that the 30% tax rate remains standard; however, a more favourable 25% CGT would apply where proceeds from share sales are reinvested in non-equity assets, such as fixed income instruments. Investments in Nigerian companies—whether listed or unlisted—will remain fully exempt, fostering much-needed capital inflows into the nation’s productive sectors.
Speaking at the dialogue, Temi Popoola, the Group Managing Director and CEO of NGX, explained the importance of clarity in the face of major reforms. “Reforms of this magnitude demand thorough understanding, and today’s session allows us to address the critical questions faced by issuers and investors ahead of implementation,” Popoola commented. “Our ultimate goal is to preserve the market’s attractiveness, ensuring sustainable growth in the long term.”
Further backing the initiative, Umaru Kwairanga, Chairman of NGX Group, underscored the pivotal role of NGX as a facilitator of informed discussions between stakeholders. He emphasised the importance of such dialogues for maintaining the market’s competitive edge, not just within Nigeria, but in comparison with other African economies.
“At NGX, we recognise that policy shifts of this scale require transparency and a well-informed market to remain competitive,” said Kwairanga. “By fostering these engagements, we ensure that such reforms not only translate into market growth but also contribute significantly to the wider economic framework.”
The forum, which brought together key players from the financial sector, also addressed essential issues such as base cost determination, prospective calculations from the Act’s commencement, and potential challenges posed by cross-listed securities to prevent double taxation.
