No Plan for Now to Apply 5% Fuel Levy — Edun

The Federal Government has said it has no immediate plan to implement the proposed five per cent Petroleum Products Tax under the Tax Administration Act, 2025.

Finance and Economy Minister, Wale Edun, made this known at a press briefing in Abuja, stressing that the surcharge is a long-standing provision from the Federal Road Maintenance Agency (FERMA) Act of 2007, not a new tax by the Tinubu administration.

The levy has drawn public outrage, with organised labour threatening nationwide strike action if the policy goes ahead. Critics fear higher fuel prices could trigger fresh inflation and worsen economic hardship.

Edun clarified that inclusion of the surcharge in the 2025 Act does not translate to automatic implementation. “No order has been issued, none is being prepared, and there is no plan for immediate enforcement,” he said. He added that the government’s focus is on improving tax governance, blocking revenue leakages, and enhancing efficiency rather than introducing new levies.

Committee Chairman on Fiscal Policy and Tax Reforms, Taiwo Oyedele, explained that the surcharge is designed to create a dedicated fund for road repairs across the country. He argued that poor infrastructure contributes significantly to high transport costs and food inflation.

Oyedele said the fuel surcharge, scheduled for January 2026, would be implemented cautiously to avoid stoking inflation. He suggested timing the rollout during favourable economic conditions, such as naira appreciation or lower global oil prices.

He stressed that revenue from the levy would be ring-fenced for road projects. “This money will be used strictly for fixing roads that can lower transport costs and reduce food prices,” he said.

Meanwhile, the Federal Government has gazetted four new tax reform laws—the Nigeria Tax Act 2025, Nigeria Tax Administration Act 2025, Nigeria Revenue Service (Establishment) Act 2025, and the Joint Revenue Board (Establishment) Act 2025—to take effect from January 1, 2026.

The reforms include zero per cent tax for small companies with turnover below N100 million and assets under N250 million, as well as a corporate tax reduction for large firms from 30 to 25 per cent, to be applied at a date set by the president on the advice of the National Economic Council.