Proposed fuel tax won't start until Naira appreciates or oil prices fall — Oyedele

The proposed 5% fuel surcharge (tax) will not be implemented until there is a significant improvement in key economic indicators, specifically an appreciation of the naira or a fall in global crude oil prices.This announcement was made by Mr. Taiwo Oyedele, Chairman of the Presidential Committee on Fiscal Policy and Tax Reforms while speaking at the Haulage and Logistics Magazine Conference & Exhibition in Lagos .Oyedele noted that while the surcharge is a sound policy designed to fund road maintenance, introducing it now would only worsen the financial strain on Nigerians. The surcharge, which was first introduced under the ex-president Olusegun Obasanjo's administration, was intended to dedicate part of fuel revenues to road repairs40% for federal roads and 60% for state and local government roads. The idea is brilliant and already being implemented in more than 150 countries, Oyedele said, adding that most of Nigerias 200,000 kilometres of roads are currently in poor condition. Oyedele clarified that although the Federal Roads Maintenance Agency (FERMA) had requested to start collecting the levy immediately after the fuel subsidy removal, the committee firmly rejected the move. We said no introducing such a tax now would be insensitive, he stated. The Committee included the surcharge in the draft tax law but with a critical safeguard: it requires the Minister of Finance to issue an official order before it takes effect. "For me, the right time will be when the naira strengthens or crude prices drop, so the surcharge wont raise pump prices, he said. Oyedele also gave assurances that the ongoing tax reforms will deliver significant relief to the haulage and logistics sector by eliminating multiple taxation, reducing costs, and improving efficiency. We are not introducing new taxes; we are removing the many duplicated ones that frustrate transporters and increase prices, he explained. Under the new policy, small transport and logistics businesses with an annual turnover below N100 million will be exempt from company income tax. Additionally, eligible operators will benefit from VAT refunds and tax incentives. Oyedele added that the reforms are designed to simplify Nigerias complex tax system and ensure that all collections are transparent and efficiently shared across all levels of government. The post Proposed fuel tax won't start until Naira appreciates or oil prices fall Oyedele appeared first on Linda Ikeji Blog.