The Federal Government has commenced the implementation of sweeping reductions in import duties on essential goods, including food staples, passenger vehicles, mass transit buses, electric vehicles and manufacturing machinery, in a major policy shift aimed at easing Nigeria’s worsening cost-of-living crisis.
Naijaonpoint reports that the new rates, which took effect this July, are contained in the 2026 Fiscal Policy Measures approved by the Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele.
The policy is regarded as one of the most significant overhauls of Nigeria’s tariff regime in recent years, targeting 127 tariff lines with reduced rates across household consumption, transport, manufacturing and industrial activity.
The government’s move comes at a critical period for the economy, with many Nigerians still battling high food prices, transport costs and weak purchasing power. Although inflation had eased from its peak of about 33 per cent in late 2024, concerns have persisted over renewed price pressures.
S&P Global recently raised its 2026 inflation forecast for Nigeria to 16.9 per cent, citing pressure from global energy shocks, which have contributed to a sharp rise in petrol prices.
A major part of the new fiscal measures focuses on food items widely consumed by Nigerian households.
Under the revised rates, duty on bulk rice has been reduced from 70 per cent to 47.5 per cent, while broken rice now attracts 30 per cent duty.
Raw cane sugar duties have been compressed to between 55 per cent and 57.5 per cent, while crude palm oil now attracts 28.75 per cent duty, down from 35 per cent.
The cuts are aimed at lowering the cost of staple foods and reducing input costs for commercial food producers.
For many households, rice remains one of the most important food items, and the reduction in duty is expected to ease pressure if the gains are passed on to consumers.
However, analysts warned that lower duties alone may not automatically translate to cheaper food, especially with persistent exchange rate pressure, high fuel prices, logistics costs and port charges.
The transport sector is also a major focus of the new tariff regime.
Duty on passenger vehicles has been reduced from 70 per cent to 40 per cent, a move expected to reduce the landed cost of imported cars.
The government also fully exempted mass transit buses and electric vehicles from import duties as part of efforts to lower transport costs and encourage cleaner energy use.
Manufacturing machinery now attracts zero per cent duty, a measure aimed at revitalising the industrial sector, reducing production costs and encouraging investment in local manufacturing.
Stakeholders said the policy could support transport operators who depend on imported buses, trucks, minibuses and light commercial vehicles for interstate haulage and urban transport services.
Many operators currently rely on ageing fleets that are costly to maintain, fuel-inefficient and prone to frequent breakdowns. The high cost of vehicle replacement has been blamed for the large number of unserviceable vehicles on Nigerian roads.
With the reduction in import levies, industry players expect a gradual decline in the landed cost of vehicles, which could allow transport companies and independent operators to renew their fleets at lower cost.
Naijaonpoint understands that the logistics sector may also benefit from the policy, especially where trucks are used to move agricultural produce across long distances.
Transport costs account for a significant portion of food prices in Nigerian markets, particularly for staple crops such as sorghum, millet, maize, yams, and cassava transported from rural production centres in the North to urban markets in the South.
Stakeholders believe any reduction in haulage costs could eventually influence the final retail prices of food items.
However, the impact is expected to be gradual rather than immediate.
Lower vehicle acquisition costs could also improve efficiency in the transport sector by enabling operators to invest in more fuel-efficient and reliable vehicles, reduce breakdowns and improve delivery turnaround time.
But these possible gains may be weakened by other structural pressures in the economy.
Fuel prices remain above ₦1,000 per litre despite crude oil falling below $73 in the international market, while the exchange rate continues to hover between ₦1,400 and ₦1,500 to the dollar.
