Nigerians can heave a temporary sigh of relief as the Federal Government has dismissed widespread reports suggesting that a five per cent fuel surcharge on petrol and diesel would take effect in January 2026.
The clarification came from the Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, Taiwo Oyedele, who explained that although the new Harmonised Tax Act signed in June 2025 provides for such a levy, no commencement date has been set.
Speaking in a video message that went viral on Friday, Oyedele said only the Minister of Finance has the legal authority to determine when the surcharge will be enforced, stressing that “January 2026 is not on the table.”
The proposed levy is not entirely new. Its roots trace back to the Federal Roads Maintenance Agency (FERMA) Act of 2002, which created FERMA as a statutory body responsible for monitoring and maintaining federal roads across Nigeria.
The law was later amended in 2007 to introduce a funding mechanism through a five per cent user charge on petrol and diesel sales.
According to official documents, 40 per cent of the surcharge revenue is allocated to FERMA, while 60 per cent goes to State Roads Maintenance Agencies.
The new Harmonised Tax Act simply incorporates this existing provision into a broader tax reform framework.
Oyedele emphasised that the essence of the surcharge is to create a dedicated funding stream for road and transport infrastructure across the country.
“The intention is to earmark and dedicate the revenue from this tax to providing transport infrastructure that can reduce logistics costs and ultimately bring down inflation,” he explained.
Fuel costs remain a sensitive issue in Nigeria. Since President Bola Ahmed Tinubu scrapped fuel subsidies in 2023, petrol prices have more than tripled, triggering sharp increases in transport fares, food prices, and inflation levels.
Any additional levy on fossil fuels risks deepening the cost-of-living crisis for millions of households.
This explains why news of the planned surcharge sparked public anxiety and criticism earlier in the week, with many Nigerians fearing fresh hardship.
Prominent opposition figures have already spoken against the surcharge.
Former Labour Party presidential candidate, Peter Obi, called on the government to suspend the idea entirely, arguing that leadership should be about reducing hardship, not increasing it.
“Introducing new taxes when Nigerians are already under strain is not the way forward,” Obi said, adding that subsidies on cleaner fuel alternatives like compressed natural gas (CNG) had quietly disappeared, making even supposed cheaper energy sources less affordable.
On its part, the Nigeria Labour Congress (NLC) has said it has not received any formal communication on the policy.
A senior NLC official who spoke to reporters said organised labour would only take a position once the matter is officially tabled.
The NLC has a long history of nationwide strikes over fuel price hikes, and its eventual stance could significantly influence public reaction if the levy is implemented in the future.
President Tinubu has defended his government’s focus on raising revenue, insisting that diversifying earnings away from oil dependency is essential for Nigeria’s stability.
Earlier this week, he announced that Nigeria had already achieved its 2025 revenue target as of August, months ahead of schedule.
According to him, this milestone demonstrates that Nigeria can fund its budget without relying heavily on borrowing.
Government officials also argue that investing surcharge proceeds in infrastructure could ease inflationary pressures in the medium term.
What Lies Ahead
While no official start date has been announced, analysts warn that the fuel surcharge could eventually become a reality. Energy experts note that the government may delay implementation until after the economy stabilises or until adequate social cushioning measures, such as affordable CNG infrastructure, are in place.
For now, Nigerians remain cautious, watching closely for any government pronouncements that might affect fuel prices and living costs.
The Federal Government’s assurance that no fuel surcharge will take effect in January 2026 provides short-term relief, but uncertainty lingers.
The debate highlights the delicate balance between raising government revenue and protecting citizens from rising costs.
As the Tinubu administration pushes forward with fiscal reforms, how it manages this policy will be critical in shaping public trust and economic stability.
