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Nigeria’s Finance Minister Commits to Careful Rollout of New Tax Reforms Amid Market Concerns
Government’s Measured Approach to Capital Gains Tax Implementation
Nigeria’s Finance Minister and Coordinating Minister of the Economy, Mr. Wale Edun, has assured stakeholders that the Federal Government will proceed cautiously and collaboratively in enforcing the recently passed tax reform legislation, with particular attention to the controversial capital gains tax (CGT) on securities transactions. This commitment was made during a significant event in Lagos, where the N1 trillion Series 2 of the Ministry of Finance Incorporated (MOFI) Real Estate Investment Fund was officially listed on the Nigerian Exchange (NGX), marking one of the largest real estate fund listings in the Exchange’s history.
Minister’s Assurance to Capital Market Participants
Addressing concerns from capital market operators, Edun emphasized the government’s intent to engage in thorough consultations to ensure the tax reforms yield optimal outcomes for Nigeria’s economy and financial markets. “We have heard your concerns regarding the capital gains tax. We will engage in a consultative process that balances the interests of the nation and the market,” he stated, underscoring the importance of listening, analyzing, and making informed decisions.
Balancing Fiscal Efficiency with Market Growth
The minister highlighted the government’s recognition of the delicate balance between enhancing revenue collection and fostering investment growth. He reiterated that the new tax policies are designed to support, not stifle, the development of Nigeria’s capital markets. This approach aligns with broader fiscal reforms aimed at improving transparency, fairness, and economic efficiency.
Landmark Listing of MOFI Real Estate Investment Fund
The N1 trillion MOFI Real Estate Investment Fund, comprising 1 billion units priced at N100 each, was admitted for immediate trading on the NGX following the traditional closing bell rung by Minister Edun. Joint issuing houses Vetiva Securities Limited and Citi Investment Capital Limited introduced the fund, urging the Exchange to facilitate its prompt trading. This fund represents a strategic initiative to deepen Nigeria’s housing and financial markets, contributing to President Bola Tinubu’s vision of transforming Nigeria into a $1 trillion economy.
Market Performance and Investor Confidence
Edun praised the NGX for its alignment with the government’s reform agenda and its efforts to expand opportunities for retail investors. He noted that the equities market has surged approximately 50% year-to-date, with total market capitalization reaching around $100 billion in dollar terms-a testament to growing investor confidence amid ongoing macroeconomic and structural reforms. “The stock exchange’s gains reflect stability in government revenues, economic growth, exchange rates, and foreign reserves,” he explained.
Promoting Financial Inclusion Through Innovative Investment Products
Highlighting the accessible pricing of the MOFI Real Estate Investment Fund at N100 per unit, Edun emphasized how such financial innovations encourage broader participation in wealth creation and cultivate a culture of long-term savings essential for national development. “This initiative enables everyday Nigerians-not just the affluent-to invest, save for the future, and contribute to the country’s economic progress,” he remarked.
Tax Reform Committee Finalizes New Legislation
The Tax and Fiscal Policy Reform Committee has completed its mandate, culminating in the passage of a new tax act now entering the implementation phase under the Ministry of Finance. Edun stressed that the rollout will prioritize fairness, extensive consultation, and economic prudence to ensure the reforms enhance revenue mobilization without undermining business and investor confidence.
Market Stakeholders Voice Concerns Over Capital Gains Tax
Despite the minister’s reassurances, brokers and NGX dealing members expressed apprehension about the potential adverse effects of the capital gains tax on market liquidity and investor sentiment. Following announcements about the CGT’s planned enforcement starting January 2026, trading activity turned negative, reflecting heightened sensitivity to tax policy changes. Sam Ndata, a respected NGX veteran, urged the government to carefully sequence reforms to preserve market momentum and confidence.
Symbolic Support and Calls for Presidential Engagement
In a show of solidarity, brokers welcomed Edun as “part of the Exchange family” and requested that he convey their concerns directly to President Tinubu. They also extended an invitation for the President to visit the NGX and participate in ringing the closing bell, signaling strong governmental support for the capital market’s growth.
NGX Experiences Historic Market Capitalization Decline Amid CGT Uncertainty
On the day of the MOFI fund listing, the NGX recorded a historic drop in market capitalization, losing N4.646 trillion and falling from N94.526 trillion to N89.88 trillion-a 4.91% decline. The All-Share Index also dropped by 5.01% to 141,327.30 points, marking the largest single-day loss in the Exchange’s history. The discrepancy between the index decline and market capitalization was partly offset by the N1 trillion MOFI Real Estate Investment Fund’s admission, which bolstered market value.
Capital Gains Tax’s Impact on Nigeria’s Capital Market
Since the announcement of the government’s plan to implement the capital gains tax, Nigeria’s capital market has shed over N6 trillion in value as of November 11, 2025. The CGT remains a contentious issue, with market participants urging the government to balance fiscal needs with sustaining investor confidence and market stability.
