FG defends 5% fuel surcharge, says funds for road repairs

The Federal Government has defended the proposed five per cent surcharge on petrol and diesel sales, saying it is designed to fund the repair of Nigeria’s dilapidated roads rather than impose further hardship on citizens.

Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, Taiwo Oyedele, made this clarification on Tuesday while speaking on Channels Television’s Morning Brief.

Oyedele admitted concerns about inflationary pressure but argued that better road infrastructure would lower the cost of moving goods and people across the country.

“Nigeria has about 200,000 kilometres of road, and only about 60,000 are okay. This is the major reason why transporting anything in Nigeria, whether goods or people, is costly and unsafe,” he said.

The tax, contained in the Nigeria Tax Act 2025, is scheduled to take effect in January 2026. But it has already triggered opposition, with the Trade Union Congress threatening nationwide strike action if the surcharge is not scrapped.

Oyedele said the levy would be implemented carefully to minimise impact, possibly at a time of naira appreciation or crude oil price drops. He added that revenues from the surcharge would be ring-fenced and dedicated solely to road repairs.

He also cited the success of the Road Infrastructure Tax Credit Scheme, which allows private companies such as Dangote, NLNG, Lafarge and MTN to fix roads in exchange for tax credits.

Oyedele stressed that the policy could be reversed if it fails to achieve its objectives.

“If it can’t work, then the process is there for the National Assembly to remove it from the law,” he said.