…says the 5% fuel tax not new, has existed since 2007.
ABUJA, NIGERIA – The iNews Times | The Federal Government has sought to allay public fears over the inclusion of a 5 per cent fuel tax in the newly signed Nigeria Tax Administration Act 2025, clarifying that the levy is not a new tax and will not take effect automatically in 2026.
Minister of Finance and Coordinating Minister of the Economy, Wale Edun, made the clarification during a press briefing in Abuja on Tuesday, amid rising concerns and threats of industrial action from labour unions over the provision.
Edun explained that the surcharge was originally introduced in 2007 under the Federal Road Maintenance Agency (FERMA) Act as a statutory user charge to support road infrastructure development and maintenance.
“The inclusion of the surcharge in the 2025 Nigeria Tax Administration Act does not mean an automatic introduction of new tax,” Edun stated. “It doesn’t mean fresh taxation automatically. The 5% surcharge has existed since 2007. Its inclusion in the new law is merely for harmonisation and transparency.”
He emphasised that before any such levy can be enforced, a formal commencement order must be issued by the Minister of Finance and published in the government gazette, a step that has not been taken.
“As of today, no commencement order has been issued or is being prepared,” the minister said.
Edun also assured Nigerians that the government is sensitive to prevailing economic conditions and has no intention of implementing fiscal policies that would further burden households and small businesses.
“Our priority is to strengthen tax governance, block revenue leakages, and improve efficiency, not to introduce unnecessary taxes or charges,” he noted.
According to him, the 2025 Tax Administration Act is part of a broader reform agenda designed to consolidate and harmonise Nigeria’s fragmented tax laws, eliminate duplication, and make the tax environment more investor-friendly and transparent.
The clarification comes on the heels of mounting backlash from various stakeholders, particularly the Trade Union Congress (TUC), which has warned of possible nationwide protests in response to fears over a fresh fuel levy.
Edun, however, reiterated that the reform process will be gradual and inclusive.
“The reforms are deliberate, evidence-driven, and phased,” he said. “We will not wake up on January 1 and impose new taxes. Nigerians will be adequately sensitised, and guidelines will be issued before implementation.”
The new Tax Administration Act, which merges four major tax-related bills, is scheduled to become operational from January 1, 2026, subject to extensive consultation, public education, and institutional readiness.
With the clarification from the finance ministry, the government hopes to douse tensions and foster a better understanding of its long-term revenue strategy without stoking public panic.
