The Digest:
The Presidential Fiscal Policy and Tax Reforms Committee has responded to concerns about the new 5% fuel surcharge, clarifying that it’s not a new levy but a restatement of an existing tax. The surcharge will only apply to fossil fuels and excludes kerosene, cooking gas, and renewable energy products.
Key Points:
- The 5% surcharge is part of the Federal Roads Maintenance Agency Act, 2007, restated in the new tax laws for transparency.
- The surcharge won’t apply to kerosene, LPG, CNG, or clean energy products.
- It won’t be immediately implemented; it requires an order from the Minister of Finance.
- The funds will be used for road infrastructure, which benefits the economy.
- The surcharge is in response to the need for sustainable road financing.
- The committee insists the surcharge is not a tax increase but a long-standing funding mechanism.
The Presidential Tax Committee reassured the public that the 5% surcharge is not a new burden, with exemptions for essential products, designed to improve Nigeria’s infrastructure. This clarification aims to provide a legal basis for future implementation while balancing economic needs.
