The year 2025 has been a pivotal period for Nigeria’s economy, marked by significant reforms, contentious industry disputes, and notable macroeconomic shifts that are expected to shape the country’s financial landscape in the years to come.
Rising fuel prices dominated public discourse, with Premium Motor Spirit (PMS) at certain points surpassing N1,000 per litre before easing to above N800, depending on the region.
The increase triggered a cascading effect on the cost of goods and services, particularly transportation, intensifying the strain on households already grappling with inflationary pressures.
Amid these challenges, the Tinubu administration enacted a series of landmark tax reforms aimed at modernizing Nigeria’s fiscal framework and boosting revenue generation.
The reforms, signed into law on June 26, 2025, included four key legislative acts:
Nigeria Tax Act (NTA): Streamlined multiple tax laws and categorised companies into “small” and “large,” exempting small companies (annual revenue up to N100 million) from Companies Income Tax (CIT), Capital Gains Tax (CGT), and the newly introduced Development Levy.
Nigeria Tax Administration Act (NTAA): Standardized tax collection across federal, state, and local governments, introducing mandatory Taxpayer Identification Numbers (TINs) and digital compliance measures, including e-invoicing for VAT-registered businesses.
Nigeria Revenue Service (Establishment) Act (NRSA): Replaced the Federal Inland Revenue Service with the Nigeria Revenue Service, designed to operate with greater autonomy and efficiency.
Joint Revenue Board (Establishment) Act (JRBA): Improved coordination between federal and state tax authorities, established a Tax Ombuds Office, and revamped the Tax Appeal Tribunal.
The reforms included progressive personal income tax measures, corporate tax adjustments, and targeted VAT provisions, including zero-rating essential goods such as food, medical supplies, and educational materials to cushion the population from inflationary effects.
2025 also witnessed tension between Dangote Refinery and downstream oil marketers, rooted in Dangote’s strategy to restructure fuel distribution.
By introducing over 4,000 CNG trucks, the refinery sought to bypass traditional importers, provoking resistance from marketers who feared job losses, reduced market share, and obsolescence of their infrastructure.
The dispute highlighted competing interests: Dangote aimed to stabilize domestic supply and reduce import dependency, while marketers insisted on a collaborative model that protected their operations and workforce.
The standoff drew calls for government intervention to ensure fair competition and sustainable industry practices.
Despite these challenges, Nigeria recorded a Q3 GDP growth of 3.98 per cent, slightly higher than the 3.86 per cent growth in Q3 2024.
The services sector remained the main driver, growing by 4.15 per cent and accounting for over 53% of GDP. The non-oil sector, including agriculture, trade, and real estate, expanded by 3.91 per cent, while the oil sector grew 5.84 per cent.
Inflation, which had surged earlier in the year, is projected to decline to approximately 31.81 per cent, while unemployment stands at 4.3 per cent overall, with youth unemployment at 6.5 per cent.
The Central Bank of Nigeria’s monetary policy rate remained at 27 per cent, and Treasury bill rates for a 91-day tenor reached 15.3 per cent.
CBN Governor Olayemi Cardoso described the Nigerian economy as more resilient than ever, highlighting financial sector stability and the capacity to withstand external shocks.
The IMF, in its October 2025 World Economic Outlook, urged Nigeria to continue structural reforms, maintain central bank independence, and implement credible fiscal and monetary policies to sustain growth.
Analysts project that the reforms, alongside rising oil production and investor confidence, could lay the foundation for stronger economic performance in 2026.
However, challenges remain, including insecurity, debt, and a rapidly growing population.
The government’s ability to translate macroeconomic stability into tangible improvements in citizens’ living standards will be a critical test in the coming year.
With GDP growth steady, inflation moderating, and structural reforms underway, Nigeria ends 2025 with cautious optimism, balancing the pressures of immediate challenges with the promise of long-term economic transformation.
