Over the past few months on this blog, we've written extensively about grants: which ones are open, how to actually win them, what separates a funded application from a rejected one. We've written about SME growth, about business registration, about what it takes to run a business in Nigeria without the infrastructure that businesses in other markets take for granted. Today, I want to step back from the how-to and talk about something underneath all of it, something I think doesn't get discussed honestly enough: why government policy, even when it's genuinely well-designed, so often fails to change what a Nigerian business actually experiences.

I've spent years building and advising on products across Nigeria and the wider African tech ecosystem, and I wrote about part of this problem last year in a longer piece for HackerNoon, "Why Africa's Tech Future Thrives on Resilience and Purpose, Not Raises, Not Hype." That piece was mostly about why African startups collapse under the weight of currency volatility, infrastructure gaps, and what I called regulatory whiplash, governments changing rules faster than businesses can reasonably comply. I want to pick that regulatory thread back up here and go deeper into it, because I think it's the single most underrated force shaping which Nigerian businesses survive and which ones quietly don't.

The background: a reform that should have worked

In June 2025, President Tinubu signed four tax reform bills into law, consolidating more than 60 separate taxes and over 200 informal levies into fewer than ten core statutes. Small companies earning ₦100 million or less annually were exempted from Company Income Tax and Capital Gains Tax entirely. Withholding tax was waived on payments under ₦2 million. It's a genuinely ambitious reform, and by most independent accounts, a well-designed one.

Then, in July 2026, the Central Bank of Nigeria published its Business Expectations Survey. Multiple taxation still topped the list of business constraints Nigerian companies reported, cited by 70.8% of respondents, ahead of insecurity and high interest rates. Not a slight improvement. Still the number one complaint, seven months after the reform meant to eliminate it took effect.

That's the gap I want to talk through today. Not whether the reform was well written, but why even a well-written reform can fail to reach the business it was written for.

1. Policy design and policy delivery are two different jobs

In the HackerNoon piece, I wrote about how "African governments can change rules faster than you can say 'compliance,'" using Nigeria's 2024 CBN KYC tightening for fintechs and Kenya's 2023 Data Protection Act as examples of regulatory shifts that forced costly overhauls on businesses with little warning. That instability is one failure mode. The tax reform is a different one, and in some ways a more frustrating one: the rule itself is good, but it doesn't reliably reach the ground it was written for. Federal law can prohibit multiple taxation explicitly, and Taiwo Oyedele, who chairs the Presidential Committee on Fiscal Policy and Tax Reforms, has said as much publicly. But a state revenue officer or local government levy collector operating three states away from Abuja doesn't automatically change behaviour because a federal statute changed. Writing the rule and delivering the rule are two entirely different jobs, and Nigeria has historically been much better at the first than the second.

2. Multiple taxation is a coordination failure, not a drafting failure

It's tempting to blame the reform itself when a statistic like the CBN's 70.8% comes out. I'd push back on that. Nigeria's tax burden on a small business has never come primarily from federal law; it comes from the accumulated weight of state levies, local government collections, and informal "agent" charges layered on top of each other. A federal law banning multiple taxation only works if state and local enforcement actually changes to match it. That's not a flaw in how the bill was written. It's a flaw in how three tiers of government coordinate, or fail to, once a bill becomes law.

3. The same policy can be relief for one business and a burden for another

I saw a version of this pattern play out with e-invoicing, now mandatory under the new tax administration framework for VAT-registered businesses. For a Lagos business with an accountant and reliable connectivity, that's a real simplification. For a business in a state with inconsistent internet, still running paper books because that's what its owner learned, the identical policy reads as a new burden stacked on old ones. I made a similar point in the HackerNoon piece about infrastructure generally: a 2025 McKinsey report found 85% of Nigerian businesses rely on private generators, adding 25 to 30% to operating costs before a single naira of tax is even calculated. Policy that assumes infrastructure a business doesn't actually have will always land unevenly, no matter how well it's drafted.

4. Government has no business running businesses

This is worth saying plainly, because I believe it, and because it cuts both ways in this argument. Government's job in this relationship is narrow: build predictable rules and enforce them consistently, all the way down to the local official who either respects a federal exemption or doesn't. Every time government has tried to go further than that, propping up sectors directly, running commercial ventures, picking winners, it has tended to produce exactly the kind of distortion Nigerian businesses already complain about. The multiple-taxation clause in the new tax reform is the live test of this right now. Oyedele's promise that violating agencies "will be sanctioned" is only as real as the sanctions that actually get applied. That follow-through is government's job, not business's, and it's the part of this reform still unproven.

5. Businesses have no business writing policy from outside the room, but they do have a role inside it

The other half of this is less comfortable, but equally true. A lot of the frustration Nigerian founders express about policy comes from engaging with it only after it becomes law, rather than while it's still being shaped. Structured private-sector input, through trade associations, business councils, formal consultation windows, tends to catch operational realities that policy written in isolation misses. That's a very different thing from businesses trying to dictate policy outcomes after the fact. One is collaboration. The other is just complaint with better timing.

Businesses also owe the system something more basic: actually using the protections built for them. A large share of Nigeria's informal sector remains unregistered, not because CAC or SMEDAN registration is genuinely difficult anymore, both processes have been meaningfully simplified, but because past experience has taught business owners not to trust that formalising pays off. That distrust is earned. It's also, left unaddressed, a self-fulfilling reason reforms built for the formal sector keep missing the businesses that need them most. I've walked through both processes in detail in our guides to free CAC business name registration and SMEDAN registration, for anyone ready to take that step rather than wait for perfect trust before acting.

6. The camel mindset applies to policy uncertainty too

In the HackerNoon piece, I argued that Silicon Valley's unicorn model, raise big, burn fast, scale immediately, doesn't survive contact with African market realities, and that the businesses built to last are what I called camels: cash-flow-positive, adaptable, built to survive 36 months without external capital or a stable regulatory environment. I'd extend that same logic to how a business should treat policy uncertainty specifically. Waiting for the multiple-taxation gap to close before formalising, before registering, before engaging with the system, is a reasonable-sounding strategy that in practice keeps a business permanently on the wrong side of every reform that eventually does land. The businesses positioned to benefit as enforcement catches up to intent are the ones already inside the formal system when it does.

7. This is a relationship, not a negotiation

The framing that keeps this stuck is treating government and business as opponents extracting concessions from each other. I don't think that framing has ever served Nigeria well, and I said something close to this in the HackerNoon piece about resilience: real endurance isn't about who wins a single news cycle, it's about who's still building, still paying salaries, still shipping product, years after the headlines move on. Government cannot manufacture business growth directly. Business cannot manufacture a stable, consistently enforced policy environment on its own. Each side can only do the part it's actually positioned to do well, and this reform will only close its own gap if both sides start acting like that's true.

What's coming next in this series

This is the first of several pieces I want to write on how policy actually shapes business trajectory in Nigeria, not just what the rules say, but what happens between a rule being signed and a business feeling its effect. Upcoming pieces will look at how monetary policy and interest rates quietly determine which businesses can access credit to scale, how regulatory whiplash specifically (the pattern I first wrote about in the HackerNoon piece) shows up across fintech, agritech, and logistics differently, and how Nigeria's trade and customs policy is reshaping which businesses can actually compete regionally under AfCFTA. If the tax reform gap discussed here resonated, that series is worth following.

In the meantime, for currently open funding and support programmes built for Nigerian businesses navigating exactly this environment, visit Siiqo's grants hub.

Why Good Government Policy Still Fails Nigerian SMEs: The Gap Between Intent and Reality