In a move expected to bring relief to Nigerians and ease the cost of transportation, the Federal Government has reduced the tariff on imported fully-built passenger vehicles, four-wheel drive cars, and station wagons from 70 per cent to 40 per cent.
The reduction, introduced under the newly approved 2026 Fiscal Policy Measures, took effect from April 1, 2026, and forms part of broader tariff reforms aimed at stimulating economic activity and reducing the cost of imported goods.
The policy is contained in a document signed by the Minister of Finance and Coordinating Minister of the Economy, Wale Edun, and implemented within the framework of the Economic Community of West African States Common External Tariff (CET) 2022–2027.
Before the new policy, importers paid a 35 per cent import duty and an additional 35 per cent levy on imported vehicles, bringing the total tariff burden to 70 per cent.
Under the revised 2026 Fiscal Policy Measures, the Federal Government has reduced the total effective tariff to 40 per cent, representing a 30 percentage point cut.
Industry stakeholders say the move could help moderate vehicle prices, reduce transportation costs, and improve mobility for businesses and households already grappling with high inflation and rising logistics expenses.
Beyond vehicle imports, the 2026 Fiscal Policy Measures also introduced an Import Adjustment Tax (IAT) affecting 192 tariff lines, alongside an import prohibition list covering 17 items from non-ECOWAS countries.
In addition, the government released a national list of 127 items with reduced import duties aimed at supporting key sectors of the economy and encouraging industrial growth.
The government also granted a 90-day grace period for importers with existing Form ‘M’ and irrevocable trade agreements executed before April 1, 2026, allowing them to clear goods using the previous duty rates.
However, authorities stressed that all new import transactions from April 1, 2026, are subject to the revised tariff structure.
Edun further disclosed that Import Adjustment Taxes — except for items under the African Continental Free Trade Area three per cent list — would be gradually reduced beginning January 2027.
According to him, the phased reduction will continue annually until full elimination by 2036, in line with Nigeria’s commitments to both African Continental Free Trade Area and ECOWAS trade integration policies.
Analysts believe the tariff reduction could provide much-needed relief in Nigeria’s automobile market, where high import duties have historically contributed to soaring vehicle prices.
Lower tariffs are also expected to improve access to vehicles for businesses, enhance logistics efficiency, and support economic productivity, particularly in sectors heavily dependent on transportation.
The development marks one of the most significant adjustments to Nigeria’s vehicle import tariff structure in recent years, signaling a shift toward policies aimed at easing cost pressures and promoting economic growth.
