The Federal Government has defended its proposed 5 percent fuel surcharge, saying the measure is designed to finance critical road infrastructure and not to impose additional hardship on Nigerians already battling inflation and high living costs.
Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, Taiwo Oyedele, stated this on Tuesday during an appearance on Channels Television’s Morning Brief. He acknowledged concerns that the tax could stoke inflation but argued that fixing Nigeria’s decaying roads would ultimately help bring down transportation costs and food prices.
“I know everybody is concerned about the impact on inflation; I’m concerned myself,” Oyedele said. “But road infrastructure is key. Nigeria has about 200,000 kilometres of roads, and only about 60,000 are in good condition. This is a major reason why moving goods and people is expensive and unsafe.”
TUC threatens strike as policy sparks outrage
The surcharge, included in the Nigeria Tax Act, 2025, is expected to take effect in January 2026. However, it has triggered widespread criticism and labour resistance. The Trade Union Congress (TUC) has issued a two-week ultimatum to the Federal Government to scrap the plan or face a nationwide strike.
Despite this, Oyedele maintained that the surcharge is not a new idea, explaining that it was introduced in 2007 but was never enforced because of fuel subsidies. He noted that subsidy removal alone cannot bridge Nigeria’s infrastructure deficit.
“Even with subsidy removal, the huge gap in infrastructure cannot be addressed by those revenues alone,” he said.
‘We’ll time it to avoid hardship’
To cushion the impact on pump prices, Oyedele said implementation would be carefully timed, possibly when the naira appreciates or global crude prices decline.
“If the naira gains about 5 percent and you introduce the tax, nobody will notice the difference. Or if crude prices drop by 5 percent, that would also be an ideal time,” he explained.
He assured Nigerians that proceeds from the surcharge would be ring-fenced and used strictly for road repairs. Oyedele also cited the success of the Road Infrastructure Tax Credit Scheme, which has enabled private firms like Dangote, NLNG, Lafarge and MTN to rehabilitate key highways.
The tax reform chief urged citizens to remain open-minded, stressing that the policy could be reversed if it fails to meet expectations.
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