By Ghazali Ibrahim
The Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, Taiwo Oyedele, has defended the proposed 5% fuel surcharge, saying it is aimed at generating a dedicated fund to repair Nigeria’s decaying road network not to increase the financial strain on households.
Speaking on Channels Television’s Morning Brief on Tuesday, Oyedele acknowledged widespread fears that the levy, set to take effect in January 2026 under the new Nigeria Tax Act, 2025, could worsen inflation.
The Trade Union Congress has already threatened a nationwide strike if the government does not scrap the tax.
“I know everybody is concerned about the impact on inflation, I’m concerned myself,” Oyedele said.
“But Nigeria has about 200,000 kilometres of road, and only about 60,000 are in good condition. This is a major reason why transporting goods or people is costly and unsafe.”
He linked poor road conditions to rising food prices, citing a gap of up to 5% between rural and urban food inflation, compared to less than 1% in most countries.
“The majority of the issues are due to bad roads and multiple taxes when moving goods,” he added.
Oyedele explained that the surcharge was first introduced in 2007 but never implemented due to fuel subsidies.
With subsidies gone, he argued that revenues alone cannot close Nigeria’s infrastructure deficit.
To limit inflationary impact, he suggested introducing the surcharge during periods of naira appreciation or falling crude oil prices, so pump prices remain stable.
The funds, he stressed, will be ring-fenced exclusively for road repairs and could be managed in partnership with the private sector, similar to the Road Infrastructure Tax Credit Scheme that enabled companies like Dangote, NLNG, Lafarge, and MTN to rehabilitate roads.
“We can all focus this money on fixing roads that make our lives better and bring down prices,” Oyedele said, urging Nigerians to keep an open mind.
“If it can’t work, the National Assembly can always remove it from the law.”
