₦airaland Forum

https://www.youtube.com/watch?v=C5CArkDfjx0?si=0_gGVN1JhkDaktKf



Taiwo Oyedele @taiwooyedele

[quote]𝐓𝐡𝐞 5% 𝐒𝐮𝐫𝐜𝐡𝐚𝐫𝐠𝐞 𝐨𝐧 𝐅𝐮𝐞𝐥: 𝘞𝘩𝘢𝘵 𝘪𝘴 𝘵𝘳𝘶𝘦 𝘢𝘯𝘥 𝘸𝘩𝘢𝘵 𝘪𝘴 𝘯𝘰𝘵?

This note seeks to clarify matters arising regarding the 5% fuel surcharge in the new tax laws. The charge is not a new tax introduced by the current administration. The provision already exists under the Federal Roads Maintenance Agency (Amendment) Act, 2007. Its restatement in the new Tax Act is for harmonisation and transparency rather than immediate implementation.

We outline the frequently asked questions below and provide clarifying explanations.

𝐅𝐫𝐞𝐪𝐮𝐞𝐧𝐭𝐥𝐲 𝐀𝐬𝐤𝐞𝐝 𝐐𝐮𝐞𝐬𝐭𝐢𝐨𝐧𝐬

𝐐1. 𝐈𝐬 𝐢𝐭 𝐭𝐫𝐮𝐞 𝐭𝐡𝐚𝐭 𝐓𝐢𝐧𝐮𝐛𝐮’𝐬 𝐚𝐝𝐦𝐢𝐧𝐢𝐬𝐭𝐫𝐚𝐭𝐢𝐨𝐧 𝐢𝐧𝐭𝐫𝐨𝐝𝐮𝐜𝐞𝐝 𝐚 5% 𝐬𝐮𝐫𝐜𝐡𝐚𝐫𝐠𝐞 𝐨𝐧 𝐟𝐮𝐞𝐥?
A1. No. The surcharge is not new. It already exists under the Federal Roads Maintenance Agency (Amendment) Act, 2007 (FERMA Act). The new Tax Act only restates it for harmonisation and transparency. Hence, it was not part of the original tax reform bills submitted by the president to the National Assembly.

𝐐2. 𝐃𝐨𝐞𝐬 𝐭𝐡𝐢𝐬 𝐦𝐞𝐚𝐧 𝐭𝐡𝐞 𝐬𝐮𝐫𝐜𝐡𝐚𝐫𝐠𝐞 𝐰𝐢𝐥𝐥 𝐜𝐨𝐦𝐦𝐞𝐧𝐜𝐞 𝐢𝐧 𝐉𝐚𝐧𝐮𝐚𝐫𝐲 2026 𝐰𝐡𝐞𝐧 𝐭𝐡𝐞 𝐧𝐞𝐰 𝐭𝐚𝐱 𝐥𝐚𝐰𝐬 𝐭𝐚𝐤𝐞 𝐞𝐟𝐟𝐞𝐜𝐭?

A2. No. The surcharge does not take effect automatically with the new tax laws. It will only commence when the Minister of Finance issues an order published in the Official Gazette as stated under Chapter 7 of the Nigeria Tax Act, 2025. This safeguard ensures careful consideration of timing and economic conditions before implementation.

𝐐3. 𝐖𝐢𝐥𝐥 𝐭𝐡𝐞 𝐬𝐮𝐫𝐜𝐡𝐚𝐫𝐠𝐞 𝐚𝐩𝐩𝐥𝐲 𝐭𝐨 𝐚𝐥𝐥 𝐟𝐮𝐞𝐥 𝐩𝐫𝐨𝐝𝐮𝐜𝐭𝐬?

A3. No. Several energy products used by households are exempt. This includes household kerosene, cooking gas (LPG), and compressed natural gas (CNG). Clean and renewable energy products are also excluded to align with Nigeria’s energy transition agenda.

𝐐4. 𝐖𝐡𝐲 𝐧𝐨𝐭 𝐚𝐛𝐨𝐥𝐢𝐬𝐡 𝐭𝐡𝐞 𝐜𝐡𝐚𝐫𝐠𝐞, 𝐠𝐢𝐯𝐞𝐧 𝐭𝐡𝐞 𝐜𝐮𝐫𝐫𝐞𝐧𝐭 𝐡𝐚𝐫𝐝𝐬𝐡𝐢𝐩 𝐚𝐧𝐝 𝐭𝐡𝐞 𝐫𝐢𝐬𝐤 𝐨𝐟 𝐡𝐢𝐠𝐡𝐞𝐫 𝐢𝐧𝐟𝐥𝐚𝐭𝐢𝐨𝐧?

A4. The surcharge is designed as a dedicated fund for road infrastructure and maintenance. If implemented effectively, it will provide safer travel conditions, reduce travel time and cost, lower logistics costs and vehicle maintenance expenses, which will benefit the wider economy. This practice is virtually universal with over 150 countries imposing various charges ranging between 20% to 80% of fuel products to guarantee regular investment in road infrastructure.

𝐐5. 𝐖𝐡𝐲 𝐜𝐚𝐧’𝐭 𝐬𝐚𝐯𝐢𝐧𝐠𝐬 𝐟𝐫𝐨𝐦 𝐟𝐮𝐞𝐥 𝐬𝐮𝐛𝐬𝐢𝐝𝐲 𝐫𝐞𝐦𝐨𝐯𝐚𝐥 𝐛𝐞 𝐮𝐬𝐞𝐝 𝐢𝐧𝐬𝐭𝐞𝐚𝐝?

A5. While subsidy savings will provide some funding, they are insufficient to meet Nigeria’s huge and recurring road infrastructure needs among other public finance needs. A dedicated fund ensures reliable and predictable financing for roads, complementing the budget and ensuring roads are not left underfunded.

𝐐6. 𝐈𝐬𝐧’𝐭 𝐭𝐡𝐢𝐬 𝐚𝐭 𝐨𝐝𝐝𝐬 𝐰𝐢𝐭𝐡 𝐭𝐡𝐞 𝐫𝐞𝐟𝐨𝐫𝐦 𝐨𝐛𝐣𝐞𝐜𝐭𝐢𝐯𝐞 𝐨𝐟 𝐫𝐞𝐝𝐮𝐜𝐢𝐧𝐠 𝐭𝐚𝐱𝐞𝐬 𝐚𝐧𝐝 𝐞𝐚𝐬𝐢𝐧𝐠 𝐭𝐡𝐞 𝐛𝐮𝐫𝐝𝐞𝐧 𝐨𝐧 𝐜𝐢𝐭𝐢𝐳𝐞𝐧𝐬?

A6. Not at all. The reforms have already reduced multiple taxes and removed or suspended several charges that directly affect households and small businesses, such as VAT on fuel, excise tax on telecoms, and the cybersecurity levy. By harmonising earmarked taxes, government is reducing duplication and ensuring a more efficient tax system.

𝐐7. 𝐖𝐡𝐲 𝐧𝐨𝐭 𝐣𝐮𝐬𝐭 𝐚𝐦𝐞𝐧𝐝 𝐭𝐡𝐞 𝐅𝐄𝐑𝐌𝐀 𝐀𝐜𝐭 𝐭𝐨 𝐫𝐞𝐦𝐨𝐯𝐞 𝐭𝐡𝐞 𝐬𝐮𝐫𝐜𝐡𝐚𝐫𝐠𝐞?

A7. Yes, the surcharge has been removed from the FERMA Act and incorporated into the new tax laws which are designed to provide a forward-looking legal framework for Nigeria. Keeping this provision in place within a harmonised legal framework ensures Nigeria is prepared to address critical challenges, such as sustainable road financing and even climate change impacts. It is not about immediate implementation, but to ensure the law provides a clear and effective framework for when it becomes necessary in the future.

𝑷𝒓𝒆𝒔𝒊𝒅𝒆𝒏𝒕𝒊𝒂𝒍 𝑭𝒊𝒔𝒄𝒂𝒍 𝑷𝒐𝒍𝒊𝒄𝒚 & 𝑻𝒂𝒙 𝑹𝒆𝒇𝒐𝒓𝒎𝒔 𝑪𝒐𝒎𝒎𝒊𝒕𝒕𝒆𝒆

princeade86:
U go defend tire. I pity masses that u guys are brainwashing.

Glory be to God for the FTC in this first Sunday of Ember months. God bless all nairalanders. God bless Nigeria.

The road cost a total of 170 million naira (nearly 266 million dollars). And to recover at least part of that cost, and to pay for its upkeep, road users will have to pay a toll. Even at the opening ceremony, Brigadier Shehu Yar'Adua led the way in paying for the service the new expressway offers."

Your Fuel Tax is Illegal Lawyers Tell Obasanjo

By Adewale Busari
30 December 2003

Lagos — A cross section of legal practitioners have thrown their weight behind Governor Bola Ahmed Tinubu's decision to drag the Federal Government to court over the proposed fuel tax contained in next year's budget, currently before the National Assembly.

Governor Tinubu yesterday threatened to drag the Olusegun Obasanjo administration to court if the fuel tax is implemented.

Labour unions give Obasanjo ultimatum on fuel tax

8 January 2004

ABUJA
Nigerian trade unions have threatened to call a fresh general strike on 21 January unless President Olusegun Obasanjo repeals a controversial new fuel tax within two weeks.

Announcing the ultimatum on Wednesday, the Nigeria Labour Congress (NLC) said the 1.5 naira (US $0.01) per litre of fuel tax that came into effect on 1 January was illegal and unacceptable.

The powerful NLC groups 29 blue collar unions covering both the public and private sectors. It include key unions in Nigeria's lifeblood oil industry. The NLC forced the government to back-track on a steep rise in petrol prices last year after it called an eight-day general strike at the end of June.

Petrol prices have risen up to 12 percent since 1 January because the introduction of the new tax was accompanied by a further liberalisation of fuel prices. Petrol in Lagos now costs between 43 and 45 naira (43 and 45 US cents) per gallon.

“Since we cannot bear this hardship indefinitely, we shall resume the general strike and protest within two weeks,” Adams Oshiomhole, president of the NLC told reporters. “The fuel tax is illegal because it lacks the necessary legislative backing for its enforcement. It's illegal for the government to insist that people pay taxes that are illegal,” he added.

The tax was included in a budget appropriation bill sent to parliament in December. However, the government has ordered that the tax become effective from 1 January even though the legislature has yet to pass the bill into law.

Several prominent legislators, including the Senate President Adolphous Wabara and Speaker of the House of Representatives Bello Masari have expressed opposition to the the tax. But Obasanjo insists that it is needed to raise funds for the maintenance and repair of the country’s decaying road network.

Fuel prices rose last year by more than 50 percent after the government first abolished subsidies on imported fuel and later allowed prices to be determined by market forces under its economic deregulation programme. Most Nigerians see cheap fuel as one of the few benefits they have derived as successive regimes mismanaged the country’s oil riches. However Obasanjo is keen to abolish expensive state subsidies on fuel which have simply encouraged smuggling to neighbouring countries where prices are much higher. He also wants to raise domestic fuel prices to international market levels in order to facilitate the privatisation of Nigeria's decaying refineries, which are functioning at a fraction of their original capacity and are unable to meet domestic demand.

The charge is not a new tax introduced by the current administration. The provision already exists under the Federal Roads Maintenance Agency (Amendment) Act, 2007. Its restatement in the new Tax Act is for harmonisation and transparency rather than immediate implementation.

naptu2:
I bet that there will be many people that will not read the posts or understand what's written in it, but they will post based on what's already in their head or based on just the headline of the thread.

ulysses:
Let PBAT do any TAXATION before 2027 as we will all vote him out enmass!!!!!
How can you add salt to our injury that we are nursing!

Nigerians will ARISE O COMPATRIOTS with our PVC come 2027.... it is US (The entire masses- Yoruba, Ibo & Hausa) vs. Them (the less than 5%)... We shall come out victorious!!!!!!
All those supporting this demonic government are observing table manners.
Let us keep our ethnic, religious & political differences aside and form a formidable unit to kick out this lawless and wicked government.
Never had it been such bad in our nations history!!!!!

Buhari’ll reduce petrol to N40/L —David-West

FORMER Minister of Petroleum and Energy, Prof. Tamunoemi David-West, said that Nigerians should expect sharp drop in petrol price from the current N87 to about N40 per litre, saying, “the president-elect, Gen. Mohammed Buhari, will reduce the fuel pump price to N40 per litre.”

https://www.vanguardngr.com/2015/04/buharill-reduce-petrol-to-n40l-david-west/

yesloaded:
Nigeria is paying fuel subsidy in 2007 so 5% siurcharge won't be a bad idea

Why are we paying another 5% surcharge when there's no fuel subsidy again?.

Why are we paying multiple tax up and down

naptu2:
Background

Everybody wants government to maintain highways, but nobody wants government to make the money to maintain the highways.

Once upon a time, long ago, government tolled the highways in order to generate the funds that it would use to maintain them.

In this video you can see that the chief of staff, Supreme Headquarters (military vice president) Brigadier Shehu Musa Yar'Adua paid the toll when he opened the Lagos-Ibadan Expressway in 1978.


https://www.youtube.com/watch?v=3_LfloE6BWc?si=ybvpzjW7C49OZO4w



However, over the years, there were claims that the toll operators were corrupt and that they did not remit the funds to the government. Private companies were hired to run the toll plazas but the allegations of corruption continued.

Therefore, sometime around 2004, the Obasanjo Administration demolished the toll plazas. The government decided that it would impose a petrol tax and use that money to maintain the expressways, instead of relying on tolls.

(Some people believe that the demolition of the toll plazas led to the deterioration of highways like the Lagos-Abeokuta Expressway).

President Obasanjo included the tax in the appropriation bill (budget) and he wanted to start collecting it before the budget was passed by the National Assembly.

However, the tax was opposed by many people.

Governor Bola Tinubu of Lagos opposed it and threatened to sue the Federal Government and the Nigerian Bar Association (NBA) agreed with him. The Nigerian Labour Congress (NLC), led by Adams Oshiomhole, threatened to go on strike and both the Senate president and the speaker of the House of Representatives expressed opposition to the tax.

President Obasanjo decided to pause implementation of the tax, due to the opposition to it. The tax was included in the Federal Road Maintenance Agency (FERMA) Act of 2007, but the act states that the implementation of the tax will begin on a date to be determined by the Minister of Finance.

In other words, it is not a new tax and it will not commence on January 1st. The reason that some people believe that it's a new tax is because a new tax law (that harmonised all taxes) was recently enacted and this old tax was mentioned in the law.