FG declares Tax ID now mandatory for Banking, Contracts, and Business in Nigeria from 2026

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The Federal Government has announced that from January 1, 2026, all taxable Nigerians must obtain a Taxpayer Identification Number (Tax ID) as a condition for accessing banking, contracts, and other allied services.

The directive is contained in the Nigeria Tax Administration Act, 2025, Part II Section 4, recently signed into law by President Bola Tinubu. The provision states: “Every taxable person shall register with the relevant Tax Authority and obtain a taxpayer identification card (Tax ID) for the purpose of compliance with tax obligations.”

In addition, the law makes it mandatory for “every ministry, department or agency of the Federal, State or Local government to register and obtain a Tax ID.”

Non-resident persons are not exempt. Section 6 (1) provides that “Non-resident persons who supply taxable goods and services to any person in Nigeria shall obtain Tax ID, as they shall be obligated to pay tax in Nigeria.”

To ensure compliance, Section 7 (3) empowers tax authorities to issue Tax IDs to individuals who fail to apply. However, it also gives them the discretion to deny an application: “The relevant tax authority is also empowered to refuse to issue a Tax ID to an applicant based on information available to it. In such a case, the authority shall inform the applicant of its decision within five working days.

The Act further ties Tax ID to public contracts and banking services. Section 8 (1)(c) makes it clear that “Tax ID is a condition for entering into any contract with the Federal and State governments.” Section 8 (2) adds that “Tax ID shall be mandatory for any person to operate a bank account or get involved in insurance, stocks, or allied services in the country, once the Act comes into force from January 1, 2026.”

Provisions were also made for temporary or permanent cessation of business. Section 10 states: “Where a taxable person temporarily ceases to carry on a trade or business in Nigeria, the taxable person shall notify the relevant tax authority of its intention to suspend its registration for tax purposes within 30 days. The Tax authority shall classify the Tax ID as ‘dormant’ and place it on suspension.” It further notes that “where a taxable person permanently ceases to carry on trade or business in Nigeria, the taxable person shall notify the relevant tax authority of its intention to deregister for tax purposes within 30 days.”

The Nigeria Revenue Service Establishment Act, 2025 also strengthens the governance framework, naming the Executive Chairman as Governing Board Chairman. The Board will include top representatives from the Ministries of Finance, National Planning, Petroleum, the Attorney-General’s office, the Central Bank, Customs, the Corporate Affairs Commission, and the Revenue Mobilisation Allocation and Fiscal Commission. Executive Directors will be appointed by the President.

The Chairman will serve a renewable four-year term, while the service will be funded through “a four percent deduction of revenues it shall collect, except petroleum royalties”.

According to the federal government, these reforms aim to modernise Nigeria’s tax system, expand the tax net, and promote transparency.

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