Taiwo Oyedele, chairman of the Presidential Fiscal Policy and Tax Reforms Committee, has said the proposed 5 percent fuel tax should only be introduced under favourable economic conditions — specifically, when the naira appreciates or global oil prices decline.
Gatekeepers News reports that speaking in an interview on Arise TV on Monday, Oyedele clarified that the levy is not an immediate plan but a policy option that could be explored without hurting Nigerians.
“For me, and this is speaking for myself, the appropriate time to consider a tax like that would be, number one, when you have an appreciation in the currency,” he said.
“If naira appreciates by just 5 percent, you will collect this tax and there will be no change in the pump price of petroleum products. It could also be when you have a decline in the international price of crude oil. And it could be a combination of both.”
He stressed that any revenue generated must have direct, visible impact on citizens.
“On the positive side, the revenue you get from this tax would have real, practical, physical impact on the people,” Oyedele noted.
“If you can travel for less time, it is safer. You save even more money, not only on fuel, time, but also productivity.”
Addressing public concerns, Oyedele said there is currently no proposal to impose a new fuel surcharge. He explained that the ongoing tax reform is focused on simplifying Nigeria’s tax system by consolidating multiple legislations into a single framework.
“While we had over 15, 20 different laws, we have consolidated. It doesn’t mean that all those old laws were useless and we need to just write everything afresh,” he said.
“In the process of trying to harmonise, you will make that call as to whether a particular tax makes sense for us to sustain it, or whether it should be repealed, or whether it should be modified.”
Oyedele added that tax laws must be designed not just for the present but for future generations.
Collection of Fuel Tax
He also clarified that if the 5 percent levy is ever applied, it will be collected by the Nigerian Revenue Service (NRS), not the Federal Roads Maintenance Agency (FERMA).
“This was in the course of legislating on the bills that this came up. Instead of FERMA to collect the tax and try to administer it, we thought it is not appropriate for an agency of government to be collecting taxes,” he said.
According to him, revenues from the levy would be earmarked for road infrastructure to improve transportation and economic productivity.
