Anger, Condemnation Trail FG’s Plan to Introduce Fuel Tax

The Federal Government’s plan to introduce a fuel tax has sparked widespread anger and condemnation across Nigeria, with many citizens describing the proposal as insensitive to the economic hardship facing the country.

According to Daily Post on Wednesday, the Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, disclosed the plan during an interview on the sidelines of the 2026 International Monetary Fund and World Bank annual meetings in Bangkok, Thailand. He explained that the tax would only take effect when the economy stabilises and Nigerians’ incomes improve enough to accommodate the additional cost.

Oyedele said the revenue generated from the proposed tax would be used to fund road infrastructure and develop a fuel reserve to help protect the country against future fuel price increases.

He explained that the existing legal framework already provides for a five per cent surcharge on certain fossil fuel products. However, the tax cannot begin until the minister issues an order published in the Official Gazette.

The minister added that household kerosene, cooking gas, compressed natural gas and clean or renewable energy products would be exempt from the proposed tax.

According to him, introducing the tax when petrol was still subsidised would have been ineffective because the government would have indirectly borne the cost. He also noted that introducing it immediately after the removal of the fuel subsidy would have placed additional pressure on Nigerians.

Oyedele maintained that the government should focus on increasing people’s incomes faster than prices rise, rather than trying to control prices.

He said the tax would be introduced only when the economy had stabilised and income levels could accommodate the additional financial burden.

However, the announcement has triggered fresh criticism of the President Bola Tinubu-led administration, especially following the removal of the fuel subsidy in May 2023.

Many Nigerians have complained that the increase in petrol prices has raised transportation costs, increased the cost of goods and services, and made it difficult for small businesses to survive.

A tailor, Niyi Osundare, described the proposed fuel tax as wicked, questioning why the government would consider imposing additional charges when petrol prices remain high.

He said many businesses were already struggling to survive because of the rising cost of fuel and other expenses.

Osundare also expressed doubt about the government’s promise that the economy would stabilise, arguing that previous assurances since 2023 had not brought sufficient relief to ordinary Nigerians.

Similarly, a lawyer and public affairs analyst, Kunle Onatade, rejected the argument that the proposed tax revenue would be used to develop infrastructure.

He recalled that Nigerians had previously been told that savings from fuel subsidy removal would be used for national development.

Onatade alleged that the proposed tax could create another opportunity for the misuse of public funds and warned that it would worsen the hardship faced by citizens.

Business groups have also expressed concern over the plan.

The Association of Small Business Owners of Nigeria urged the Federal Government to prioritise measures that would reduce the financial pressure on businesses and households.

The association warned that an additional fuel charge could increase production and transportation costs, eventually forcing consumers to pay more for goods and services.

Despite the criticism, Oyedele insisted that the government would not introduce the tax secretly. He maintained that the proposed measure would be implemented transparently and that its benefits would become clear at the appropriate time.

He also noted that several countries, including African nations, impose different taxes and charges on petroleum products.

The debate comes more than three years after President Bola Tinubu announced the removal of the fuel subsidy in May 2023, a decision that led to a significant increase in petrol prices and the cost of living.

As Nigerians continue to grapple with rising living costs, many are urging the Federal Government to focus on providing relief, improving electricity supply, supporting businesses and increasing household incomes before considering any additional tax on fuel.

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