The Federal Government has clarified that the controversial five percent fuel surcharge will not take effect alongside the new tax laws in January 2026.
Chairman of the Presidential Fiscal Policy and Tax Reforms Committee, Taiwo Oyedele, explained that the provision is not a fresh tax introduced by President Bola Tinubu’s administration but a restatement of an existing law under the Federal Roads Maintenance Agency (Amendment) Act of 2007.
He noted that the surcharge’s inclusion in the Nigeria Tax Act 2025 was part of efforts to harmonise overlapping tax laws, enhance transparency, and modernise the fiscal framework.
“This is not a new tax,” Oyedele stressed. “It has always been part of the FERMA Act. The new law only restates it for clarity. It was not included in the original tax reform bills sent by the President to the National Assembly.”
The clarification followed public concern that fuel prices could rise in January when the new tax regime commences. Oyedele assured that the surcharge would not automatically take effect, stressing that activation requires a separate order by the Minister of Finance, published in the Official Gazette.
He added that if implemented in the future, the levy would mainly apply to petrol and diesel, serving as a dedicated fund for road infrastructure and maintenance.
The committee defended the surcharge as a global best practice, noting that over 150 countries impose fuel-related levies to guarantee steady road investment. It further argued that subsidy savings remain insufficient to cover Nigeria’s vast infrastructure needs, making ring-fenced funding crucial.
Oyedele also highlighted other relief measures already in place, such as the suspension of VAT on fuel, removal of telecoms excise tax, and cancellation of the cybersecurity levy.
On why Tinubu did not present a separate surcharge bill to the National Assembly, the committee explained that since it was already law, lawmakers only needed to consolidate it into the new tax framework.
“The surcharge has been removed from the FERMA Act and re-incorporated into the new tax law to ensure legal clarity whenever the government decides to implement it,” the statement said.
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