Anger Erupts Over New Vehicle Tax as Opposition Accuses FG of Squeezing Citizens

 

Fresh concerns are mounting across Nigeria following reports that the Federal Government is set to introduce a new vehicle tax regime scheduled to take effect from July 1, 2026. Critics say the move could place an additional financial burden on already struggling citizens.

A viral government-themed notice circulating online states that the proposed tax will apply to all registered vehicles, including private, commercial, and corporate automobiles. Officials claim the revenue will support road infrastructure, transport services, and national development.

However, opposition voices have strongly questioned the timing of the policy, arguing that Nigerians are already grappling with rising fuel costs, inflation, and harsh economic realities.

According to recent fiscal policy reports, the government has introduced a green tax surcharge targeting higher-engine vehicles, with implementation linked to the July 1 timeline. Vehicles between 2,000cc and 3,999cc are expected to attract a 2% levy, while those above 4,000cc may face a 4% charge. Smaller vehicles, electric vehicles, and mass-transit buses are reportedly exempt.

Opposition figures and civil society groups have described the development as “another layer of taxation on the ordinary Nigerian,” insisting that the government should first demonstrate accountability in the use of existing public funds before introducing fresh levies.

“This is coming at a time when citizens are battling unprecedented hardship. Instead of easing pressure, the government appears focused on expanding the tax net,” one opposition source said.

The policy is part of broader fiscal reforms under President Bola Ahmed Tinubu’s administration, which officials say are aimed at boosting non-oil revenue and encouraging environmental sustainability.

Reactions Trail Proposed Tax

Weighing in on the policy, former Labour Party presidential candidate Peter Obi faulted the government’s approach to taxation, warning that “prosperity cannot come by taxing poverty.” In a statement on Nigeria’s new tax laws, Obi said: “Taxation without trust is robbery. A tax system devoid of clear public benefits isn’t reform; it is, quite frankly, extortion.” He urged the government to pause implementation, arguing that tax policies must deliver tangible benefits to citizens and not worsen hardship.

Similarly, Fiscal Policy Partner and Africa Tax Leader at PwC, Taiwo Oyedele, described a related vehicle tax as “retrogressive, ill-conceived, and poorly designed.” He said: “To be sensitive and demonstrate empathy, the government should not impose any new or higher taxes on transportation, energy, or food which are the most impacted by the subsidy removal.” Oyedele added that the tax adds complications to multiple taxation and should be set aside “in the interest of good order.”

Nollywood actor Uche Maduagwu also reacted to an earlier annual vehicle fee policy, noting that Peter Obi “will never impose such a fee upon the people.”

Still, many Nigerians have taken to social media to question whether the tax will genuinely translate into improved roads and safer transport systems, or simply deepen the economic strain on households.

As the July deadline approaches, attention is now turning to whether the Federal Government will provide clearer details on enforcement, exemptions, and how the proceeds will be managed.