Federal Government Approves 2026 Fiscal Policy Measures To Slash Vehicle Tariffs And Revise Excise Duties

Finance Minister Wale Edun approves new fiscal measures slashing vehicle tariffs to 40% and introducing a Green Tax Surcharge starting July 2026.

By: AXL Media

Published: Apr 11, 2026, 5:33 AM EDT

Source: Information for this report was sourced from PREMIUM TIMES

Strategic Overhaul Of National Tariff Structures

The Federal Government has officially approved the 2026 Fiscal Policy Measures, a comprehensive document intended to modernize Nigeria's trade and excise frameworks. Signed by Wale Edun, the Minister of Finance and Coordinating Minister of the Economy, the policy introduces Supplementary Protection Measures that align with the ECOWAS Common External Tariff for 2022–2027. These measures include an Import Adjustment Tax affecting 192 tariff lines and a national list of 127 items that will benefit from reduced import duties. This strategic shift is designed to stimulate growth in critical sectors by lowering the cost of essential imported goods.

Significant Reductions In Automotive Import Costs

One of the most notable changes in the new fiscal regime is the drastic reduction in tariffs for motor vehicles. According to the approved document, the total effective tariff for fully built passenger motor vehicles, four-wheel drives, and station wagons has been lowered to 40 percent. This represents a significant decrease from the previous high-tariff regime, which saw rates as high as 70 percent. Additionally, the Import Adjustment Tax on crude palm oil has been pegged at 28.75 percent, signaling a broader government effort to lower entry barriers for key commodities while maintaining regional trade commitments.

Phased Elimination Of Adjustment Taxes

The government has outlined a long-term commitment to trade liberalization in line with the African Continental Free Trade Area and ECOWAS protocols. Starting in January 2027, all Import Adjustment Taxes—excluding products specifically on the AfCFTA 3 percent list—will undergo an annual reduction process. This gradual phase-out is scheduled to continue until these taxes reach 0 percent by the year 2036. This timeline is intended to provide domestic industries with a predictable window to improve competitiveness before full exposure to duty-free regional trade.