The Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, Mr Taiwo Oyedele, has stated that the proposed 5% fuel surcharge (tax) will not be enforced until there is a notable improvement in key economic conditions, especially an appreciation of the naira or a decline in global crude oil prices.
Speaking at the Haulage and Logistics Magazine Conference & Exhibition held in Lagos yesterday, he explained that although the surcharge is a well-intentioned policy aimed at funding road maintenance, introducing it at this period would only aggravate the financial difficulties faced by Nigerians.
According to him, the surcharge, which was originally introduced during the administration of former President Olusegun Obasanjo, was designed to allocate part of the fuel revenues towards road repairs — 40% for federal roads and 60% for state and local government roads.
“The idea is brilliant and already being implemented in more than 150 countries,” Oyedele said, adding that a large portion of Nigeria’s 200,000 kilometres of road network remains in poor condition.
He clarified that although the Federal Roads Maintenance Agency (FERMA) had requested approval to commence collection of the levy following the removal of fuel subsidy, the committee rejected the proposal.
“We said no – introducing such a tax now would be insensitive,” he stated.
The Chairman added that while the committee included the surcharge in the draft tax legislation, safeguards were put in place to ensure it does not take effect until an official order is issued by the Minister of Finance.
“For me, the right time will be when the naira strengthens or crude prices drop, so the surcharge won’t raise pump prices,” he said.
Oyedele also assured that the ongoing tax reform efforts would bring substantial benefits to the haulage and logistics industry by tackling the issue of multiple taxation, lowering operational costs, and improving overall efficiency.
“We are not introducing new taxes; we are removing the many duplicated ones that frustrate transporters and increase prices,” he said.
He further explained that under the new policy, small transport and logistics enterprises with an annual turnover below N100 million would be exempt from company income tax, while qualified operators would also be entitled to VAT refunds and tax incentives.
Oyedele concluded by noting that the reforms aim to simplify Nigeria’s complicated tax framework and guarantee that all tax collections are handled transparently and distributed efficiently across all tiers of government.
