The Federal Government has approved the implementation of its 2026 fiscal policy measures, introducing wide-ranging tariff adjustments aimed at stimulating critical sectors of the economy and strengthening domestic production.
In a circular dated April 1, 2026, signed by the Minister of Finance and Coordinating Minister of the Economy, Wale Edun, the government confirmed that the new framework replaces the 2023 fiscal policy measures. The document outlines a revised tariff structure covering 127 items, with reduced import duty rates designed to “promote and stimulate growth in critical sectors of the economy”.
Under the new regime, several major imports will attract lower tariffs. The import adjustment tax on crude palm oil has been reduced to a total effective rate of 28.75 percent, while tariffs on fully built passenger vehicles, including four-wheel drives and station wagons, have been cut to 40 percent from the previous 70 percent introduced in 2015.
The policy also targets essential goods and industrial materials. Tariffs on rice in bulk or large packaging have been reduced to 47.5 percent, broken rice to 30 percent, and refined salt to 55 percent. Raw cane sugar and processed sugar products have also been adjusted downward to between 55 and 57.5 percent. Industrial inputs such as steel products, ceramic tiles, and electrical components are included in the reductions, with some categories now attracting rates as low as 10 to 35 percent.
In addition, certain sectors have been granted zero-duty status to encourage investment and expand production capacity. These include agricultural and manufacturing machinery, cargo ships above 500 tonnes, railway locomotives, and specialised medical equipment such as breathing apparatus. Other items, including modular surgical theatres and air compressors, have also seen reduced tariff rates.
To ease implementation, the government approved a 90-day grace period for importers who had opened Form ‘M’ before April 1, allowing them to clear goods under the previous tariff regime.
Further fiscal adjustments are scheduled, with a new excise duty framework and a green tax surcharge set to take effect from July 1, 2026. The green tax will exclude specific categories, including vehicles below 2000cc, mass transit buses, electric vehicles, and locally manufactured automotive components.
The government stated that the measures form part of a broader strategy to create a more balanced and market-driven trade environment, while supporting domestic industries, improving competitiveness, and maintaining economic stability.
