The future of tax dispute resolution in Nigeria  (Part I)

Nigeria’s Tax Reform Acts have signalled a profound restructuring of the country’s fiscal rulebook, by merging a range of disparate federal tax statutes into a singular code. Importantly, the Nigerian Tax Administration Act (NTAA 2025) and the Joint Revenue Board (Establishment) Act (JRBA 2025) instituted an overhaul of the dispute resolution mechanisms.

The formal pathway for a merits-based challenge, that is, a challenge to the correctness of an assessment in fact and law, is now as follows: an assessment by the tax authority is followed by a taxpayer’s objection, which must be brought within thirty days of the assessment. Where the disagreement persists, an objection is filed at the Tax Appeal Tribunal. Further, section 41 (8) & (9) NTAA provides for dissatisfied parties to subsequently appeal the TAT’s decision solely on points of law to the Federal High Court, followed by the Court of Appeal, and finally the Supreme Court.
The analysis presented here contends that while these reforms will produce a more streamlined system, the earliest disputes are likely to crystallise around three fault lines; (1) how tax disputes will be fought under the new regime (2) the application of key tax rules, especially those related to digital assets, capital gains and the minimum tax payable and (3) the constitutional and administrative boundaries of federal-state harmonisation under the Joint Revenue Board Act. This article explores the first fault line in depth and explains the early uncertainties that corporate taxpayers should watch out for.

The Nigerian Tax Reform Acts have fundamentally re-invented the tax dispute resolution system. For example, the Nigeria Tax Administration Act 2025 (NTAA 2025) has introduced a strict timeline for objections, while the Joint Revenue Board (Establishment) Act 2025 has created two distinct but interrelated institutions: the Tax Appeal Tribunal (TAT) and the Office of the Tax Ombud. How these components interrelate with one another will likely be a source of initial disputes.

Section 41(2)(a) NTAA 2025 denotes that where a taxpayer disputes an assessment by the tax authority, the taxpayer must lodge a written notice of objection within 30 days of the assessment. The objection must also have the precise, substantive details: the specific issue disputed, the exact monetary values, the amendment proposed, and the justification for the amendment. Importantly, the tax authority is now subject to a tight clock: it must respond to the objection within 90 days, or the objection will be upheld in the taxpayer’s favour.

It is expedient to note that Nigerian jurisprudence, as exemplified by section 15 of the Interpretation Act and decisions such as Ezeigwe v. Nwawulu, includes every calendar day, including weekends and public holidays, in the computation of the 90 days limit. This means that tax officials will face immense pressure to promptly review and revise assessments.

Early disputes will likely test this rule: for instance, where an under-resourced tax office fails to respond in time on a complex corporate audit, is the assessment truly overturned? The statute’s wording is unequivocal, but one can foresee litigation where authorities seek to revive lapsed assessments. Accordingly, Corporate tax departments will be well advised to diarise and closely follow that 90-day window.

Once the tax authority issues a decision on the objection and the company remains dissatisfied, the next step is to seek recourse at the Tax Appeal Tribunal (TAT). Section 29 of the JRBA unequivocally grants TAT jurisdiction over disputes emanating from the Nigeria Tax Act, the Nigeria Tax Administration Act, tax laws of the National Assembly and importantly, laws from the Houses of Assembly of States. The inclusion of laws from the Houses of Assembly of States is particularly interesting, as it deviates from the historical position that disputes arising under state-enacted tax laws fall exclusively within the jurisdiction of State High Courts.

Going further, in Chemiron International Limited v. LIRS, the State High Court accepted jurisdiction to hear a Personal Income Tax matter, demonstrating that even federal statute disputes, administered by the state, were within the purview of State High Courts.

The expansive language used in the Tax Reform Acts, therefore, remodels the TAT from a forum for federal disputes to a significantly more encompassing central hub for all tax disputes. Notably, section 272 of the Constitution grants State High Courts jurisdiction over disputes emanating from state laws.

Section 29 JRBA, thus, creates overlapping jurisdiction. The contexts around where the TAT displaces State High Courts’ jurisdiction, if at all, will be determined by the courts in the early cases.

The Tax Reform Acts have also created the Office of the Tax Ombud, which is intended to investigate and resolve complaints relating to administrative unfairness. In other words, where a taxpayer feels maltreated or harassed, the Ombud serves as an independent arbiter to resolve complaints through mediation or conciliation.

To facilitate this, section 41(1)(d) of the JRBA 2025 empowers the Ombud to enter tax offices, inspect records and summon individuals for further information. Where the Ombud finds room for improvement, recommendations will be relayed to the tax authority.

That said, it is expedient to note that the Ombud’s role has clear limits which prevent overlap with formal adjudication. The Ombud is strictly prohibited from determining tax liability, issuing tax assessments, interpreting tax legislation and reviewing issues that are already sub judice. This statutory boundary could be a source of early friction. One can forsee attempts by taxpayers to circumvent substantive tax assessments by reframing their complaint as an administrative failure.

Further, Ombud’s recommendations are non- binding. While the Ombud will be within its powers to recommend remedies, one can only ponder the extent of moral and persuasive authority such recommendations will carry within the tax administration. Section 49 (4) of the JRBA limits the Ombud’s enforcement mechanism to referring the non- compliant agencies to the National Assembly or the State House of Assembly to perform oversight functions.

This dependence on political oversight, rather than a direct judicial or executive enforcement power, will be an important area for taxpayers to observe.
A final point to note is that section 41(8) NTAA 2025 mandates a payment of 20 percent of the disputed tax amount into a designated account as security, before the High Court can hear the case. This requirement, intended to discourage frivolous appeals, functions as a barrier to accessing the superior courts. Taxpayers should factor this 20 percent deposit as the price of contesting a TAT decision.

In summary, the tax disputes borne from Nigeria’s 2025 Tax Reform Acts will thoroughly redefine how disputes are resolved. Strict procedural timelines, the expansion of the TAT’s reach, the introduction of the Tax Ombud and pre- appeal payments, amongst others, redraw the strategic outlook companies must adopt when managing tax disputes. Success under this new regime will depend not only on the strength of a taxpayer’s substantive position but on a clever use of the dispute resolution architecture to achieve one’s objectives.