Key Points

• The Nigerian government has paused the implementation of the revised levy regime due to concerns from the private sector.

• Industry groups like MAN have argued that the new levy system could burden businesses already facing financial struggles.

• A technical working group will review the framework, and the government plans to complete the review within 60 days.

The Nigerian government has paused the implementation of a controversial regulatory framework introduced by the Financial Reporting Council of Nigeria (FRCN).

This move aims to ease tensions with the private sector and restore investor confidence. Minister of Industry, Trade, and Investment, Jumoke Oduwole, announced the decision on March 26, 2025.

Temporary pause to address concerns

The decision to pause the implementation of the revised levy regime follows weeks of protests from business groups.

The revised framework expanded the scope of Public Interest Entities (PIEs) and introduced new levy requirements.

Initially, these changes sparked significant backlash, with many businesses expressing concerns over the impact on their operations.

Oduwole clarified that the government is not suspending the regulation outright. Instead, the government is initiating a pause to allow for a review based on feedback from various stakeholders.

She emphasized that this pause is not a suspension, as such an action would contradict the National Assembly’s legislation.

Oduwole stated, “We are a listening administration,” and assured that the review would be completed within 60 days, not three months or indefinitely.

Industry groups voice concerns

The Manufacturers Association of Nigeria (MAN) has been one of the loudest voices against the new levy system.

MAN’s Director General, Segun Ajayi-Kadir, criticized the expansion of PIEs, which now includes large private companies and privatized entities that were previously exempt.

He argued that the new framework would burden businesses that are already struggling with inflation, currency devaluation, and low consumer demand.

Ajayi-Kadir pointed out that for publicly quoted companies, the annual levy has jumped from N1 million to N25 million.

For non-listed companies, the levy is now linked to turnover, with no cap, even if the company is unprofitable. These changes, he claimed, could worsen financial strain and discourage investment.

Government’s response and next steps

In response, the Ministry of Industry, Trade, and Investment announced the formation of a technical working group.

This group, which will include representatives from the private sector and the FRC, will review the framework using a risk-based, evidence-driven approach.

The goal is to come up with a solution that is fair and will enhance business competitiveness.

Oduwole reiterated the government’s commitment to fairness and transparency. She also acknowledged that businesses are facing significant challenges in the current economic climate and expressed openness to revisiting aspects of the levy framework.

She confirmed that the findings of the review will be submitted to the president and, if necessary, to the National Assembly for legislative consideration.

FRCN defends new regulation

Rabiu Olowo, the Executive Secretary of the FRCN, defended the introduction of the new regulatory fees.

He argued that the fees were necessary for effective oversight and that they were common practice in other countries like the US and the UK.

Olowo emphasized that the goal is to ensure a sustainable and well-regulated business environment.

He reassured the private sector that the FRCN is committed to protecting long-term business interests, not just short-term concerns.

Olowo stated, “I am acting in your best interest, and this is what best looks like,” stressing the importance of having adequate regulatory tools in place to safeguard businesses.