FG Introduces New Tax From July 1, Slashes Tarrif on Rice, Palm Oil and Sugar
- The FG will be introducing a new tax from July 1 on the importation of beverages and tobacco products
- A new tarrif cut has also been approved for rice, palm oil and sugar, under the 2026 Fiscal Policy Measures
- The reforms also include an import adjustment tax, an import prohibition list, and transitional relief for importers
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The federal Government has approved import tariff reduction on rice, palm oil and sugar, while introducing new excise duties on beverages, tobacco products and other selected items under the 2026 Fiscal Policy Measures.
Source: Getty Images
The policy, contained in a circular signed by the Minister of Finance and Coordinating Minister of the Economy, Wale Edun, takes effect from April 1, 2026.
The policy aimed at aligning Nigeria’s trade framework with the ECOWAS Common External Tariff while supporting local industries and boosting revenue.
According to the document, food imports were adjusted, with bulk rice now attracting a duty of 47.5%, down from 70%, while broken rice has been reduced to 30%.
Crude palm oil imports are now pegged at an effective rate of 28.75%, while raw sugar tariffs range between 55% and 57.5%, also lower than previous levels.
Refined salt for human consumption has been adjusted to 55%, the Nation reports.
A move aimed at boosting industrialisation, the government has approved zero import duty on agricultural machinery.
New tax from July 1
As part of the changes, new excise duties will apply to non-alcoholic and alcoholic beverages, cigarettes and tobacco products.
A green tax surcharge will also be introduced, both taking effect from July 1, 2026, Vanguard reports.
. The move is part of efforts to boost government revenue while discouraging consumption of certain products.
However, the government provided exemptions under the green tax policy.
Vehicles with engine capacity below 2000cc, mass transit buses, electric vehicles and locally manufactured auto components will not be subject to the surcharge, a move seen as encouraging cleaner transportation and local production.
Source: Getty Images
Transition period for importers
The policy includes a 90-day grace period for importers who already have approved 'Form M’ documents and agreements concluded before April 1, enabling them to process shipments using the previous tariff structure.
Edun explained that the Import Adjustment Tax will be phased down starting in January 2027 and completely scrapped by 2036, in line with Nigeria’s obligations under the African Continental Free Trade Area (AfCFTA).
According to the Federal Government, the measures aim to boost local industry, enhance adherence to trade rules, safeguard domestic producers, and support sustained economic growth.
Cost of cars is getting cheaper
Legit.ng earlier reported that the federal government has reduced import tariffs on vehicles to 40% from 70%, a move expected to lower the cost of bringing cars into Nigeria.
Data from the National Bureau of Statistics shows that imports of passenger vehicles rose to N1.58 trillion in 2025, marking a 24.64% increase from N1.26 trillion in 2024.
On a two-year basis, passenger car imports grew by 6.89% compared to N1.47 trillion recorded in 2023.
Source: Legit.ng
