By Jemimah Wellington, JKNewsMedia Correspondent
CONCERNS OVER Nigeria’s deteriorating road network dominated the remarks of the Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, Taiwo Oyedele, who explained that the proposed fuel surcharge is designed to generate a dedicated fund for road repairs rather than add pressure on households.
Speaking on Channels Television’s Morning Brief, Oyedele acknowledged growing public fears that new tax reforms could worsen inflation but argued that better infrastructure remains critical to reducing the high cost of transporting goods and people across the country.
PUNCH Online also reported that a 5 percent fuel surcharge forms part of the Nigeria Tax Act, 2025, which was recently enacted and is set to take effect in January 2026.
The measure has already sparked concerns, with the Trade Union Congress (TUC) threatening a nationwide strike if the Federal Government does not withdraw the tax.
“I know everybody is concerned about the impact on inflation, I’m concerned myself,” Oyedele admitted.
“But we also know that around the world, road infrastructure is very important. 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 linked the poor state of roads directly to inflation, highlighting the significant gap between rural and urban food prices.
“If you look at the rural inflation of food and compare it with the inflation of food in urban centres, sometimes the difference is as high as 5 percent.
“In most countries, that gap would be under 1 percent. The majority of the issues are to do with the state of the road and the multiple taxes being collected whenever you move goods around,” he explained.
Oyedele dismissed arguments that the surcharge is unnecessary following fuel subsidy removal.
He noted that the tax had originally been introduced in 2007 but was not enforced because the government was subsidising fuel at the time.
He stressed that while subsidy removal has created fiscal space, the revenues remain insufficient to close the infrastructure deficit.
“Even with the removal of fuel subsidy… the huge gap we still have in terms of infrastructural development is not going to be addressed by those revenues alone,” he said.
On implementation, he assured that the surcharge would be carefully managed to avoid fuelling inflation or disproportionately affecting vulnerable citizens.
“Some of the strategies for this surcharge could be to time it at a period when there is an appreciation in the value of the currency.
“The naira gained 1 per cent yesterday alone; if the naira gains about 5 percent and you put in this tax, nobody will notice the changes in the pump price.
“Or if the price of crude oil in the international market drops by about 5 percent, you can also have it at that point,” he stated.
Oyedele emphasised that funds from the surcharge would be ring-fenced, dedicated solely to fixing failing roads.
“Then we can all focus this money to ensure that it is dedicated to fixing roads that can make all our lives better and bring down the prices of items,” he said.
He also pointed to the effectiveness of the Road Infrastructure Tax Credit Scheme, which enables private companies to fund road construction in exchange for tax credits.
“We have the road infrastructure tax credit that is done with the private sector; we can see the advantage.
“People who live in Apapa cannot make any complaints at all, because based on that policy, the likes of Dangote, NLNG, Lafarge, and MTN are fixing roads,” he noted.
He added that a similar model could be replicated to ensure efficient use of the new surcharge.
“There’s nothing that says we can’t have a similar arrangement for the private sector to be involved in ensuring that this money is efficiently utilised,” he said.
The tax reform chief urged Nigerians to adopt an open approach, underlining that the National Assembly retains the power to reverse the measure if it fails to achieve its objectives.
“I think people need to look back and see how these things can work for our country. And if it can’t work, then the process is there for the National Assembly to remove it from the law,” Oyedele concluded.
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