- Eyes drop in global oil price
BY CHINYERE OBIORA – Following concerns expressed by Nigerians over the Federal Government’s tax regime, Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, Mr Taiwo Oyedele, has assured that the proposed five percent fuel surcharge (tax) will not be implemented until there is a significant improvement in key economic indicators.
According to the public policy expert, these key indicators include appreciation in the value of Naira and/or a drop in global crude oil price.
Oyedele, who dropped the hints at the Haulage and Logistics Magazine Conference & Exhibition in Lagos, said, “For me, the right time will be when the Naira strengthens or crude prices drop, so the surcharge won’t raise pump prices.”
The Committee Chairman said though the surcharge is a sound policy designed to fund road maintenance, introducing it now would worsen the financial strain on Nigerians.
He said the surcharge, first introduced under the ex-president Olusegun Obasanjo administration, was intended to dedicate part of fuel revenues to road repairs, 40 percent for federal roads and 60 percent for states and local governments roads.
While noting that “The idea is brilliant and already being implemented in more than 150 countries”, Oyedele said it is unfortunate that most of Nigeria’s 200,000 kilometres of roads are in poor condition.
He further said though the Federal Roads Maintenance Agency (FERMA) had requested to start immediate collection of the levy after fuel subsidy removal, the Committee rejected the move.
“We said no because introducing such a tax now would be insensitive”, Oyedele stated, adding that the Committee included the surcharge in the draft tax law but with safeguards requiring the Minister of Finance to issue an official order before it takes effect.
Also assuring that the ongoing tax reforms would deliver significant relief to the haulage and logistics sector by eliminating multiple taxation, reducing costs, and improving efficiency, Oyedele said, “We are not introducing new taxes; we are removing the many duplicated ones that frustrate transporters and increase prices.”
He said under the new policy, small transport and logistics businesses with annual turnover below N100 million will be exempted from company income tax, while eligible operators will benefit from VAT refunds and tax incentives.
For him, the ongoing reforms will simplify Nigeria’s complex tax system and ensure that all collections are transparent and efficiently shared across all levels of government.
