The Federal Government has moved to quell public anxiety by denying reports that a 5% surcharge on petrol and diesel will take effect in January 2026. Officials have clarified that while the legal framework for the levy exists, no specific date has been set for its implementation.
The clarification was provided by Taiwo Oyedele, Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, in a video message released on Friday. Oyedele stressed that while the new Harmonised Tax Act signed by President Bola Tinubu in June provides for the surcharge, the authority to determine its commencement rests solely with the Minister of Finance.
“What we have is a provision that already existed under the Federal Roads Maintenance Agency (FERMA) Act, which has now been consolidated into the new tax law. However, it does not take effect in January 2026, as has been wrongly reported,” Oyedele stated.
The surcharge, when eventually introduced, is designed to apply exclusively to fossil fuel products like petrol and diesel, while exempting cleaner energy sources such as cooking gas, compressed natural gas (CNG), and household kerosene. This measure is not entirely new; it was first introduced in the 2002 Act establishing FERMA and later refined in the 2007 Amendment Act. The latter created a funding structure that allocates 40% of the proceeds to FERMA and the remaining 60% to State Roads Maintenance Agencies.
According to Oyedele, the revenue generated from the surcharge is intended to fund the development of transport infrastructure, which could, in turn, help to lower logistics costs and ease inflationary pressures.
The clarification comes at a sensitive time for the Nigerian public. Following the removal of the fuel subsidy in 2023, petrol prices have tripled and inflation has surged. This economic reality has heightened concerns that any new fuel levy could further strain household budgets and complicate the government’s efforts to stabilize the economy. The government’s decision to clarify the issue aims to manage public expectations and provide more transparency regarding its fiscal policy agenda.
