The Digest:
The new Nigerian Tax Act has introduced a 5% surcharge on locally produced fossil fuel products, such as petrol, diesel, and compressed natural gas (CNG). The surcharge aims to boost government revenue while excluding clean and renewable energy products from its scope.
Key Points:
- A 5% surcharge is now applied to locally produced fossil fuel products.
- The surcharge will be collected during the earliest transaction: supply, sale, or payment.
- It applies to petrol, diesel, and CNG but not clean or renewable energy products.
- The surcharge will be calculated based on the retail price of fossil fuels.
- The Federal Inland Revenue Service (FIRS) will administer the surcharge, with monthly collections.
- Clean energy, including solar, wind, and hydropower, is exempt from the surcharge.
- The law also clarifies that household kerosene, cooking gas, and CNG are exempt from this new tax.
The 5% surcharge on fossil fuel products aims to raise government revenue without affecting renewable energy. The law is expected to impact retail prices, with FIRS managing the collections starting shortly.
Sources: TheCable
