Nigeria: The 15 Percent Fuel Import Levy

The recently introduced 15 per cent ad valorem levy on petrol and diesel imports, as approved by President Bola Tinubu, may be well-intentioned in its aim to protect local refineries and promote self-reliance in fuel production. However, the timing and design of this policy raise serious concerns about its economic and social consequences for ordinary Nigerians.

At a time when over 133 million citizens are classified as multi-dimensionally poor, any policy that directly increases fuel prices will inevitably deepen the cost-of-living crisis. Transport fares, food prices, and general inflation will all rise, further straining families already struggling with the effects of subsidy removal and stagnant wages.

While protecting local industries is a legitimate goal, the government must recognise that Nigeria's refining sector is still in its infancy. The Dangote Refinery and other modular plants have not yet achieved the capacity to meet national demand. Imposing a levy before full domestic sufficiency risks creating scarcity and worsening inflation.

Instead of penalising importers and consumers, the government should focus on incentives that strengthen local refineries -- such as tax reliefs, affordable credit facilities, and improved infrastructure. A gradual policy, tied to measurable increases in local production, would achieve the same long-term goal without inflicting unnecessary hardship.

Moreover, transparency is essential. Nigerians deserve clarity on how the projected N1 trillion revenue from the levy will be used. Redirecting part of these funds into social safety programmes, agricultural support, and public transport subsidies could help cushion the impact on vulnerable groups.

Economic reform must be humane to be sustainable. The government should reconsider the immediate implementation of this levy and adopt a phased approach that balances industrial protection with the welfare of the people.

Aza Abba Tavershima, Department of Mass Communication,

University of Maiduguri

Read the original article on Daily Trust.

Nigeria: The 15 Percent Fuel Import Levy - A Painful Policy That Needs Rethinking