Precious Nwonu, Enugu
Nigeria will introduce taxes on petroleum products when the economy stabilises and household incomes improve enough to accommodate the additional costs, the Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, has said.
Oyedele explained that the Federal Government would prioritise the completion of ongoing economic reforms, stabilisation and the restoration of economic growth before implementing the proposed taxes.
He disclosed this during an interview with ARISE News on the sidelines of the 2026 International Monetary Fund and World Bank Annual Meetings in Bangkok, Thailand.
The minister said introducing fuel taxes immediately after the removal of petrol subsidies would place an additional burden on Nigerians already grappling with rising living costs.
According to him, the government must first improve economic conditions and strengthen household purchasing power before considering additional taxes on petroleum products.
Oyedele noted that several countries around the world impose taxes on fuel, with the tax component accounting for between 20 and 80 per cent of pump prices in some markets. He added that many African countries have between six and 10 different taxes on petroleum products.
He, however, maintained that Nigeria must consider its current economic realities before adopting similar measures.
The minister argued that improving citizens’ incomes was more important than attempting to keep prices artificially low, noting that efforts to suppress prices had not proved sustainable.
He said the government’s priority was to ensure that incomes grew faster than prices, expand the middle class and improve the general standard of living.
Oyedele added that revenue generated from the proposed fuel taxes would be earmarked for road infrastructure and the development of strategic fuel reserves to help cushion the impact of future price shocks.
He explained that the reserves could provide a buffer against disruptions in the petroleum market, allowing the government to temporarily reduce or suspend the taxes when necessary to ease pressure on consumers.
The minister said more than 50 countries had used tax reductions to respond to fuel market disruptions, but Nigeria lacked a similar option because it did not previously have the proposed taxes in place.
Oyedele also assured Nigerians that the government would not introduce the taxes secretly, stressing that the law requires the relevant order to be published in the Federal Government’s official gazette before it can take effect.
He said the government would ensure that Nigerians understood the reasons for introducing the taxes and the benefits they were expected to deliver.
The minister reiterated that the proposed measures would only be implemented when economic conditions improved sufficiently to enable households to bear the additional costs.
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