Tax Laws: Court Okays Jan 1 Take-off
A Federal Capital Territory High Court sitting in Abuja on Wednesday, ordered the Federal Government to proceed with the implementation of the new tax regime scheduled to commence on January 1, after dismissing a suit seeking to halt its take-off.
In a ruling, the presiding Judge, Justice Bello Kawu, struck out an application filed by the Incorporated Trustees of African Initiative for Abuse Public Trustees, which sought an interim injunction restraining the Federal Government, the Federal Inland Revenue Service and the National Assembly from implementing the newly gazetted tax laws.
The plaintiff had approached the court, naming the Federal Republic of Nigeria, the President, the Attorney-General of the Federation, the President of the Senate, the Speaker of the House of Representatives and the National Assembly as defendants, over alleged discrepancies in the new tax legislation.
In the ex parte application, the group asked the court to restrain the government and its agencies from implementing or enforcing provisions of the Nigeria Tax Act, 2025; the Nigeria Tax Administration Act, 2025; the Nigeria Revenue Service (Establishment) Act, 2025; and the Joint Revenue Board of Nigeria (Establishment) Act, 2025, pending the determination of the substantive suit.
However, Justice Kawu held that the application lacked merit and failed to establish sufficient legal grounds for the grant of the reliefs sought.
The court ruled that the plaintiff did not demonstrate how the implementation of the new tax laws would occasion irreparable harm or amount to a violation of constitutional provisions, stressing that fiscal policy and economic reforms fall within the lawful powers of the government.
The judge further held that once a law has been validly enacted and gazetted, any perceived errors can only be addressed through legislative amendment or a valid court order, adding that controversies surrounding a tax law do not, on their own, justify a halt to its implementation.
Consequently, the court affirmed that there was no legal impediment to the commencement of the new tax regime and directed that its implementation should proceed as scheduled from January 1.
The CTC of the ruling sighted by our correspondent on Wednesday stated, “I have considered the application together with the affidavit in support. I have also considered the submission of the learned counsel for the claimant/applicant together with the judicial authorities cited and I am of the strong view that the court lacks power to stop implementation of a law already signed by the appropriate authority without concrete evidence of any wrongdoing. At this preliminary stage it will be difficult, if not impossible, to prove any wrongdoing because at this stage the court should be careful not to touch on the main issue.
“It is my considered opinion that granting injunction at this preliminary stage will be touching the subject matter in the main suit. It should be noted that once an Act is signed into law, it can only be repealed by the lawmakers or any offending section set aside by the court of law. Be that as it may, an ex parte application cannot be used to set aside the coming into force of any Act already signed into law or gazetted.
“In view of the above, the implementation of the Tax Act 2025 and other related Acts will commence on January 1st 2026 and continue to be in force pending the hearing and determination of the Originating Motion before this Honourable Court”.