The Federal Government has moved to calm public concern over reports of a new fuel tax, clarifying that the controversial five per cent surcharge included in Nigeria’s recently consolidated tax laws will not take immediate effect. Officials say the levy, which has triggered widespread criticism, is not a fresh measure but a dormant provision dating back nearly two decades.
Committee chairman Taiwo Oyedele said in an interview that the levy, which has provoked strong criticism from labour unions and the public, is not a new measure but a provision dating back to 2007 that was never enforced because of fuel subsidies.
“This is not a fresh tax,” Mr. Oyedele explained. “It has always been part of the law, originally intended to fund road maintenance. What is new is that the reforms now harmonise existing provisions into a clearer framework.”
Mr. Oyedele stressed that the surcharge can only take effect after a commencement order is issued by the Minister of Finance and published in the official gazette. “It cannot be applied arbitrarily,” he said, adding that implementation could be timed to ensure fuel prices do not rise, for instance when the naira strengthens or global oil prices fall.
Finance Minister Wale Edun reinforced this position at a press briefing in Abuja, noting that there is “no plan, immediate or otherwise, to implement the surcharge.” He described the reform as a process of consolidation, not fresh taxation.
Public concern, Mr. Oyedele admitted, stems largely from mistrust of government’s ability to apply the funds transparently. He proposed stronger accountability measures, including publishing collections and showcasing specific road projects financed by the levy.
The fuel charge debate comes as Nigeria embarks on its most significant tax overhaul in decades. Four new legislations the Nigeria Tax Act (NTA), Nigeria Tax Administration Act (NTAA), Nigeria Revenue Service Act (NRSEA), and Joint Revenue Board Act (JRBEA) were signed into law on June 26, 2025 and have now been gazetted.
Key features of the reforms include a “top-up tax” on multinationals and companies with turnover above ₦50bn paying less than 15 per cent effective tax; a progressive capital gains tax exempting low-income earners and small asset sales, while raising the rate for high-net-worth individuals to as much as 25 per cent; a higher personal income tax threshold exempting individuals earning up to ₦100,000 per month; and the full allocation of stamp duty revenue to states. Incentives were also introduced for the mining sector to stimulate growth beyond oil and gas.
Organised labour has rejected the fuel levy, threatening strikes over what unions describe as a growing tax burden on citizens. Mr. Oyedele criticised the stance, arguing that reforms should be contested through parliamentary amendments rather than industrial action.
Despite the backlash, both Mr. Oyedele and Mr. Edun insisted the reforms are designed to simplify Nigeria’s fragmented tax system, modernise revenue collection, and create a fairer distribution of the tax burden.
“Reforms are never easy,” Mr. Oyedele said. “But with sincerity, transparency, and consistency, Nigerians will come to see that these changes are in their long-term interest.”
