The Federal Government has unveiled a new set of tariff reforms under the 2026 Fiscal Policy Measures (FPM), introducing widespread adjustments to import duties aimed at boosting economic growth.
The policy, approved in a document dated April 1, 2026, and signed by the Minister of Finance, Wale Edun, replaces the 2023 fiscal framework.
A key feature of the reform is the revision of import duties across 127 tariff categories, including rice, sugar, vehicles, pharmaceuticals, and industrial materials. According to the government, the changes are designed to “promote and stimulate growth in critical sectors of the economy.”
Under the new structure, duties on several essential goods have been reduced. For instance, tariffs on fully built vehicles such as passenger cars and SUVs have dropped from 70 percent to 40 percent, while rice import duty has been cut significantly.
The Import Adjustment Tax (IAT) on crude palm oil has also been lowered to an effective rate of 28.75 percent, compared to previous higher rates.
To cushion the transition, the government introduced a 90-day grace period for importers who opened Form ‘M’ before April 1, allowing them to clear goods using the old tariff rates.
However, the policy also brings in new measures, including an excise duty regime and a green tax surcharge, both scheduled to take effect from July 1, 2026.
Some of the notable adjustments include reduced duties on sugar, salt, steel products, and industrial inputs, as well as zero-duty rates on selected items like agricultural machinery, cargo ships, and certain medical equipment.
The government also announced exemptions from the green tax for specific categories, including vehicles below 2000cc, electric vehicles, and mass transit buses.
Officials say the reforms are part of a broader effort to strike a balance between generating revenue, supporting local industries, and lowering the cost of essential imports.