FG slashes interest rate on late tax payment

The Federal Government has reduced the penalty interest rate for late settlement of tax liabilities, effective from October 1, 2026. Under the new regime, interest on naira-denominated tax liabilities will be pegged to the Central Bank of Nigeria's Monetary Policy Rate plus one percentage point, down from the previous five-percentage-point penalty. The measure is contained in the Nigeria Tax Administration (Interest on Late Payment of Tax) Order, 2026, issued by the Minister of Finance and Coordinating Minister of the Economy, Mr Taiwo Oyedele. The new Order will apply uniformly to taxpayers dealing with federal, state, and Federal Capital Territory tax authorities.

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