The Nigerian government has announced plans to introduce a new fuel consumption tax that will see citizens pay N500 for every N10,000 spent on petrol, starting in January 2026. The new levy represents a 5% charge aimed at reducing the country’s reliance on fossil fuels.
According to government officials, the tax will be implemented at the point of purchase and will apply solely to petrol. Other energy sources such as kerosene, cooking gas, and Compressed Natural Gas (CNG) will be exempt, as part of a broader push to promote cleaner energy alternatives.
Authorities say revenue generated from the levy will be directed toward climate change mitigation projects and the development of renewable energy infrastructure across the country.
However, the announcement has sparked widespread concern. Economists and civil society groups warn that the tax could drive up transport costs and exacerbate inflation, especially in a country already grappling with high living expenses.
Critics also argue that the flat-rate tax structure is regressive, disproportionately impacting low-income households who spend a larger share of their income on fuel.
While the government insists the policy is necessary to transition Nigeria toward a greener future, many citizens remain skeptical fearing the economic burden may outweigh the environmental benefits in the short term.