As Nigeria transitions into a new tax regime, industry leaders and policy experts have raised concerns over the capacity of businesses to adjust, warning that poor transition planning could heighten operational risks and weaken productivity in the short term.

The concerns came to the fore at an advocacy roundtable hosted by the Chartered Institute of Personnel Management of Nigeria (CIPM), where insurers, economists and human resource professionals examined the implications of the reforms on corporate Nigeria.

Speaking at the session, General Counsel and Human Resource Director at AXA Mansard Insurance Plc, Omowunmi Mabel Adewusi, said organisations must move beyond compliance and adopt structured change management strategies to navigate the transition effectively.

“Tax reforms of this scale come with operational complexities. There needs to be a serious change management strategy that every employer must embark upon, she said, noting that internal systems, policies and workforce structures must be aligned with the evolving regulatory framework,” she noted.

She stressed that transparent communication would be critical to maintaining stability within organisations, urging employers to engage employees proactively to reduce uncertainty.

Employers need to be more open, more transparent and more understanding as they move towards adopting the new tax framework, Adewusi added.

Other experts at the forum echoed similar concerns, stressing that the transition phase could pose significant challenges, particularly for small and medium-sized enterprises.

President of the CIPM, Olusegun Mojeed, said the reforms would have direct consequences for workforce management and payroll systems.

“Tax reforms will impact compensation structures, employee benefits and compliance processes. HR professionals must take the lead in helping organisations adapt without disrupting productivity,” he said.

Chief Executive Officer of the Centre for the Promotion of Private Enterprise, Dr Muda Yusuf, warned that while the reforms are necessary, implementation must be carefully managed to avoid unintended consequences.

“The transition phase is critical. Businesses are already dealing with cost pressures and any abrupt adjustment without adequate clarity could create disruptions. There must be consistency in policy implementation,” Yusuf said.

Also speaking, Managing Director of Cowry Asset Management Limited, Johnson Chukwu, noted that the reforms could ultimately strengthen the business environment if properly implemented.

A tax consultant and partner at KPMG Nigeria, Wole Obayomi, added that many organisations are still unprepared for the operational impact of the reforms.

Beyond understanding the law, companies need to retool their processes, retrain staff and upgrade systems; without this, compliance gaps could expose them to penalties, he said.