The study investigates the impact of e-commerce on Value Added Tax (VAT) revenue generation in Nigeria, specifically evaluating the transition from the Finance Acts to the Nigeria Tax Act 2025. The study utilized a descriptive and empirical research design, applying an Ordinary Least Squares (OLS) regression model to time-series data from 2020 to 2025. Key variables included e-commerce transaction volume, inflation, and a dummy variable representing the 2025 tax reforms. The results indicate a positive and statistically significant relationship between e-commerce growth and VAT revenue (p < .05). Specifically, the implementation of Continuous Transaction Controls (CTC) and the "Virtual Staple" rule under the 2025 Act led to an estimated 24% improvement in collection efficiency within the first fiscal year. The study concludes that legislative modernization is the primary driver of digital tax optimization. It recommends that the FIRS Institutionalize Social Commerce Monitoring, Partner with Fintechs (Moniepoint, OPay) to automatically prompt vendors for a TIN once they exceed the ₦50 million threshold