LunagisthubFG’s New Tax Policy: A 5% Petrol Surcharge
The Federal Government of Nigeria is set to introduce a 5% surcharge on locally produced and imported petrol, which is expected to generate N796bn annually. This new tax policy, contained in the Nigeria Tax Administration Act, is part of the government’s efforts to shore up non-oil revenues and promote fiscal
However, consumers have expressed concerns about the additional tax burden, citing the harsh economic realities in the country. The removal of fuel subsidies earlier this year has already led to increased pump prices, and the 5% surcharge is expected to further hike prices.
Oil marketers have also raised concerns about the impact of the surcharge on pump prices. They argue that the additional tax will increase the cost of refined petroleum products, which may be passed on to consumers.
The government aims to use the surcharge to promote fiscal sustainability and reduce its reliance on oil revenues. The policy targets fossil fuel products, including petrol, diesel, kerosene, and aviation fuel, among others.
The introduction of the 5% petrol surcharge is a significant development in Nigeria’s tax was expected to generate N796bn annually. While the government’s objectives are clear, the impact on consumers and the broader economy remains to be seen. As the policy takes effect on January 1, 2026, it will be crucial to monitor its effects and make adjustments as necessary.
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