The Federal Government has clarified how revenue from the recently announced 5% fuel surcharge will be shared, stating that 40% of the proceeds will go toward federal road maintenance, while the remaining 60% will be allocated to state governments.
Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms, Mr. Taiwo Oyedele, disclosed this during an interview on Channels Television’s The Morning Brief on Tuesday.
Oyedele explained that the levy is not a new invention of the current administration, but rather a provision contained in a law passed in 2007. Its enforcement was delayed for years due to the fuel subsidy regime.
“This surcharge did not originate from President Tinubu’s administration. It was introduced under the 2007 Act, but implementation was suspended because subsidies were still in place,” he clarified.
He added that the surcharge was not included in the 2025 tax reform bills signed into law earlier this year and was also not proposed by the Executive to the National Assembly.
“It only resurfaced during deliberations on the reform bills when the need to streamline tax collection processes arose. The decision was to avoid multiple agencies imposing different taxes,” Oyedele noted.
Recent reports suggesting that the 5% surcharge would take effect in January 2026 have sparked outrage, with many Nigerians criticising the policy as poorly timed amid surging inflation and rising fuel costs.
Civil society organisations and labour unions have condemned the move, describing it as punitive. The Trade Union Congress (TUC) branded the policy “economic wickedness” and threatened mass protests if the plan proceeds. Similarly, private sector leaders have warned that the levy could further suffocate businesses already struggling to survive.
Oyedele, however, dismissed claims of a January 2026 commencement date, stressing that no official timeline for implementation has been set.
“There is no directive or policy statement indicating a January 2026 rollout. Speculations about the start date are misleading,” he emphasised.
Despite the controversy, Oyedele insisted that the surcharge offers a sustainable way to fund Nigeria’s deteriorating road infrastructure.
“This policy is about fixing our roads and ensuring proper maintenance across the country. While it may appear burdensome in the short term, Nigerians stand to benefit significantly from better road networks in the long run,” he argued.
The debate over the fuel surcharge is expected to intensify in the coming months as the government balances the need for infrastructure funding with public concerns over rising living costs.
