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The International Monetary Fund (IMF) has recommended introducing taxes on fuel products and telecommunications services in Nigeria as part of measures to increase government revenue and create fiscal space for development spending.
In its 2026 Article IV Consultation report, the IMF also suggested increasing the VAT rate and extending VAT to fuel products. However, it cautioned that the timing of new taxes must consider Nigeria’s rising poverty levels and worsening food insecurity. The recommendations could spark fresh debate, as similar proposals have faced strong opposition in the past.
KEY POINTS (SO WHAT?)
New fuel taxes would increase petrol prices, worsening the cost of living for households.
Telecom excise duties would raise call and data costs, hitting businesses and consumers.
The IMF projects revenue gains of up to 4.6% of GDP over the medium term from combined reforms.
Previous attempts to introduce telecom excise duties were suspended after widespread opposition.
The government faces a delicate balance between raising revenue and protecting vulnerable citizens.
The IMF advised that the timing of any new taxes must ensure cash transfer systems are in place to cushion the impact on the poor.
Sources: The Punch (IMF 2026 Article IV Consultation report)
