Tax Term
What is Progressive Taxation?
A tax system where higher incomes are taxed at higher rates.
Detailed Explanation
Nigeria uses progressive taxation with bands ranging from 0% to 25%. This means different portions of your income are taxed at different rates, with lower income taxed at lower rates.
Example
On ₦5,000,000 income: First ₦800k at 0%, next ₦2.2m at 15%, remainder at 18%.